VW TDI Diesel Recall Cutting Off Access to Year-End Deals

By

Senior Pricing Analyst

As CarsDirect’s resident pricing analyst, Alex offers must-know analysis of pricing & incentives to those looking to buy or lease a car. His consumer-oriented coverage of the latest trends and breaking news has been featured in publications such as Car and Driver, Motor Trend, Automobile Magazine and Autoblog.

Follow On: Twitter | Website

, Senior Pricing Analyst - September 22, 2015

Volkswagen's imminent recall of TDI diesel models has been quickly spiraling out of control- the tally currently stands at up to 11 million vehicles affected worldwide. While the ramifications for the world's largest automaker have not yet been fully realized, shoppers are already losing out. That's because the automaker's model year changeover is effectively being put on hold, preventing access to some of the best deals of the year on diesels. However, there are alternatives if you know where to look and are flexible. Here's what you need to know.

Sales halted

Last weekend, Volkswagen issued a rare order to stop the sale of diesels equipped with the 2.0-liter "EA 189" TDI engine. The move came in response to an allegation from the EPA that the automaker built a software mechanism into its cars to provide false emissions readings while undergoing testing.

There is still no estimate on what a fix will involve and when the vehicles will become available again. With Volkswagen's model year change just starting to get under way, shoppers are unable to take advantage of the year's best offers, some of which most people don't even know about.

Hidden bonus for diesels

While it sounds reasonable for diesels to sell on their own merits, the truth is that Volkswagen has been relying on hidden incentives to reduce their premium over their gas counterparts. For example, unadvertised dealer cash incentives on the 2015 Passat TDI worth up to $3,000 have been helping sell-down remaining inventory. That's up to $1,000 more than the gas model and the second-highest amount of any other Volkswagen.

September is also the first month that dealer cash has been available on both the gas and TDI versions of the 2015 Golf and Golf SportWagen. The incentives, worth as much as $750, are incredibly unusual given how well the two have been selling. However, diesel shoppers are unable to take advantage of these rare programs.

Note that since these are manufacturer-to-dealer incentives, dealers have discretion over how much to pass along, if any. In the most competitive markets, the incentives have enabled dealers to sell models like the Passat for well below the factory invoice price.

Learn more about dealer cash incentives>>

Alternatives

With sales of attractively-priced diesels like the Jetta on hold, shoppers don't really have a good alternative at the same price point. Even the Chevy Cruze Diesel starts at $26,485 with destination, $2,925 more than a 2015 Jetta TDI S with automatic. There's also availability to consider- the car might exist but the vast majority of Chevy dealers don't keep it in stock due to low demand.

Shoppers wanting brag-worthy fuel economy may want to consider a hybrid. Deals on the 50 mpg Toyota Prius worth up to $3,000 have been exceptional due in part to a major redesign next year. Leases have also been outstanding, with a $20 payment cut on the Prius Two to $199 per month for 36 months with $1,999 due at signing. Its effective lease cost is now just $10 more per month than a 2015 Toyota Camry ($255 vs. $245).

Deals on the lower-profile 50 mpg Prius c are also impressive, like a massive $2,000 rebate in some regions. A $20 cut in lease payment has brought it down to $159 per month for 36 months with $1,999 at signing. That's identical to this month's lease on the 2015 Corolla and $10 per month more than a Toyota Yaris despite being $4,005 more expensive.

See this month's best deals on green cars>>

Our take

Volkswagen's compliance issues will undoubtedly damage its reputation and call into question the real-world viability of their diesel offerings. With so much still up in the air, diesel shoppers may be forced to wait an extended period until a fix is identified so that sales can resume.

That being said, alternatives exist. Gas prices have been at incredible lows, resulting in some of the best deals we've ever seen on hybrids. As a result, flexible shoppers valuing fuel economy have some outstanding alternatives with the potential to result in serious savings.

Explore more of this month's best deals>>

For an easy way to find the best deals, visit the CarsDirect Deals Page for the latest deal-related news and analyses. Browse expert buying advice updated monthly on nearly 300 models for insider insights you'll only find at CarsDirect. Be sure to sign up for email alerts to have the latest deals delivered straight to your inbox.

Offers listed here are based on a resident in Southern California and may be subject to change. Most lease offers are for well-qualified buyers based on available credit and exclude tax, license, title, registration, document fees and insurance. Not all buyers may qualify. Please check with your CarsDirect Trusted Dealer to confirm details and eligibility.

, Senior Pricing Analyst

As CarsDirect’s resident pricing analyst, Alex offers must-know analysis of pricing & incentives to those looking to buy or lease a car. His consumer-oriented coverage of the latest trends and breaking news has been featured in publications such as Car and Driver, Motor Trend, Automobile Magazine and Autoblog.

Follow On: Twitter | Website

Privacy Policy|Terms of Use|Cookie Policy|Disclaimer
COPYRIGHT 1999-2019 MH Sub I, LLC dba CarsDirect.com