- VW claims Prestige Imports has consistently failed to meet sales targets for over a decade.
- Since 2011, the dealer has reportedly achieved just over half of its required sales volume.
- VW initially sent a deficiency letter to the NY dealership in October 2010 and again in 2024.
If you’ve ever wondered what happens when a dealership can’t meet its targets for over a decade, here’s a juicy example. Volkswagen of America is trying to terminate its dealer agreement with Prestige Imports in Pleasantville, New York, claiming the dealership has been underperforming for well over ten years. In a bid to cut the cord, VW has taken the dealer to court, accusing them of breaching their contract by failing to sell enough cars.
The dealer entered into a VW contract back in 1998, agreeing to comply with the company’s operating standards and annual sales targets. According to a lawsuit filed in the U.S. District Court for the Southern District of New York, Prestige Imports has failed to meet its sales objectives. In fact, the dealership has managed to hit only a little over half of its expected sales since 2011.
Read: VW Dealers Are Furious, Scout Couldn’t Care Less
In its complaint, VW claims, “Prestige has long failed to effectively represent the Volkswagen brand and has no valid excuse for its poor performance,” adding that the company’s patience “is justifiably at an end.”
Prestige Imports also operates a Subaru franchise. VW states it first sent a deficiency letter to the dealer in October 2010, followed by a notice of default in August 2011 due to its ongoing underperformance. Despite these warnings, VW continued to offer extensions. In 2024, they issued another notice of default, setting an April 1 deadline for Prestige to “correct breaches of its sales performance obligations.”
While this deadline was extended until September 30, 2024, VW says Prestige has not implemented the necessary measures to get back on track. According to the lawsuit, Prestige is one of VW’s worst-performing dealerships in both New York State and the surrounding region.
“Despite VWoA’s sustained efforts over many years, Prestige continued to fail to achieve a satisfactory level of sales performance and has remained among the worst-performing dealers in New York State and in the region,” VW says. “Prestige failed to implement VWoA’s suggestions to create an effective service-to-sales process, an improved online presence and a concerted digital marketing campaign. Indeed, Prestige reported zero dollars spent on advertising initiatives for new Volkswagen vehicle sales in 2024.”
The lawsuit also states that customers living near Prestige are choosing to buy VW products from other nearby dealerships, indicating the dealer “is failing to effectively attract and retain customers,” Auto News reports.
