VW's spent several billion $$$ buying back those cars, and if they can turn a profit at all they'll sell them. It costs VW a few thousand $ to do the fix and warranty the car... If they can wholesale it for more they recover some costs, so no point in taking a total loss by crushing the cars.
Yes, they'll fix and sell them
IF they can turn a profit. Some of these vehicles might be prime-condition early buybacks, stashed in these lots before a fix became available. As the supply of buyback TDIs coming into dealerships dwindles, some of these might find their way back to VW dealers for the fix and resale, much as prime-condition vehicles being turned in now are being fixed and resold at the same dealerships where they're bought back.
The problem I see in getting these vehicles back on the street are two-fold:
1) What's the break-even point? Yes, there's the repair cost, transportation, dealer prep (including changing oil, performing overdue services, replacing brakes, tires, battery, and wipers, if necessary), advertising, and transaction costs. But potentially the biggest cost is the extended emissions warranty. You mention it, but it's worth looking at what the warranty really covers and for how long. Unlike most warranties that are X years or Y miles, whichever comes first, this warranty is for 10 years from original in-service date or 4 years from emissions repair, whichever is GREATER. A 100,000-mile 2010 TDI with the emissions fix performed in 2018 would be covered until 2022 or 150,000 miles! The warranty covers:
- the entire exhaust gas after treatment system, including DOC, NOx Reduction Catalytic Converter, DPF, etc.
- the entire fuel system, including fuel pumps, high pressure fuel rail, fuel injectors, and all sensors and actuators
- the EGR system
- the air intake pipe and charge air cooler, charge air temperature sensor and air mass sensor (HFM)
- the
turbocharger, including the turbocharger damper
- the glow plug
- the On-Board Diagnostic (OBD) system,
any malfunctions detected by the OBD system other than those related to the transmission
- "additionally, the engine long block warranty shall cover the engine sub-assembly that consists of the assembled block, crankshaft, cylinder head, camshaft, and valve train."
Note that this warranty has no deductibles, covers parts, labor, and taxes, and even provides for a loaner car for repairs lasting more than 3 hours. Unlike warranties that can be weaseled out of through arbitration or some other fine print, this warranty carries the authority of the court. Because of the warranty, VW takes a big risk any time they elect to repair and resell a vehicle, which drives up VW's costs for ensuring that any vehicle they elect to repair is mechanically sound.
2) Because these vehicles sitting in 37 parking lots are losing value and aging by the day, they have to be repaired and sold quickly. There's no way the VW dealer network could absorb and sell 300,000 TDIs in a short period of time (it took them years to sell that many when they were new). If VW were to do the repairs and wholesale the vehicles through a 3rd party, what effect would it have on prices of new
and used VWs, especially with tens of thousands of 2014 and 2015 vehicles suddenly available at dealerships all over town? This would negatively impact both VW and their dealer network.