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Audi Commentary: Mr Themba Mabasa Case

Dear: Media Partner

As requested, please find a detailed response from Audi South Africa relating to Mr
Mabasa’s claims on social media. We have purposefully provided a great detail of
information as we do believe that every story has two sides, we would like to take this
opportunity to share Audi’s version of what transpired and our efforts to resolve the
matter amicably. Mr Mabasa has failed to disclose pertinent information, as well as
contradicting himself on social media.

We would also like to reiterate that we take the issue of a vehicle catching fire very
seriously. When this was reported to us, we took immediate action and a full
investigation was conducted internally. We also referred this incident to our
headquarters in Germany to establish if similar incidents have occurred anywhere else
world-wide.

As per our letters to Mr Mabasa, we have expressed our regret and concern about the
fire and our relief that this did not result in any injuries to him.

Audi South Africa and the Audi Brand worldwide stand for a high level of integrity and
transparency. With this in mind, we feel that a full account of events and more detailed
information needs to be provided in response to Mr Mabasa’s allegations on social
media.

Sales transaction

Mr Mabasa purchased his Audi TT from Audi Centre Richards Bay (an independent
Audi retailer / Dealer) in April 2015. The following information had been uncovered
during the sales transaction and agreement to which Audi South Africa was not privy.
These details were only discovered when Audi South Africa offered to buy-back Mr
Mabasa’s Audi TT (explained later under Offers made to Mr Mabasa).

The recommended retail price of Mr Mabasa’s Audi TT was R628 479,72.


The invoice price was R879 312,88.
A difference of R250 833,16 had been added to the invoice price.
This was based on over-priced specification options on the vehicle (e.g. Audi design
selection, Lumbar support), as well as priced specification which are standard on the
vehicle (e.g. Front sports seats, air conditioning, Audi Virtual Cockpit).

As a result, Mr Mabasa’s Audi TT had been over-financed by an amount in excess of


R250 000 over a period of 72 months i.e. in excess of 39% of the value of the vehicle
at the time. The over-financing arrangement was concluded between Audi Centre
Richards Bay and Mr Mabasa. Mr Mabasa was party to this arrangement as evidenced
by the fact that he consented to it by signing a contractual waiver confirming his
approval of this transaction, and accepting all liability for the overpayment in the event
of the “return/trade in or write-off” of the vehicle.

The over-financing arrangement was put in place by Audi Centre Richards Bay and Mr
Mabasa as a solution to allow him to pay off the balloon payment on his trade-in
vehicle (BMW). Audi South Africa condemns this practice by one of its retailers. A full
investigation will be done to establish how this transaction was allowed by the Dealer
management and will result in corrective actions being put in place. Discussions with
Financing Institutions will also be needed.

Servicing history

Within the first two years of purchase (2015 – 2017), Mr Mabasa’s Audi TT had been
assessed and worked on repeatedly in respect of complaints concerning the vehicle’s
entertainment and sound system. This included speaker and amplifier replacements on
eight visits to a Dealer, as well as a system software upgrade. All of which was covered
through the Audi Freeway Plan.

Mr Mabasa took his concerns about the fact that these repairs were necessary, to the
Motor Industry Ombudsman, which ruled in favour of Audi South Africa. Audi South
Africa, in an endeavour to address Mr Mabasa’s dissatisfaction, offered to refund him
for the cost of the sound system - which he declined.

At the beginning of this year (February 2018), Mr Mabasa’s Audi TT overheated. It was
towed to Audi Centre Cape Town where a thermostat was replaced. Mr Mabasa was
given a courtesy car during the thermostat replacement.

He also complained about high oil consumption, rear spoiler malfunction and that his
vehicle key was not working. After inspection by the Dealer, there was found to be no
fault with the rear spoiler and the battery on the vehicle key was replaced.

In regard to the oil consumption complaint, it was necessary for an oil consumption test
to be accurately undertaken, that the vehicle be driven for 1000 KM. The oil was
replaced and sealed for this purpose. Mr Mabasa however never returned the vehicle
for assessment. Mr Mabasa repeated this complaint and a second test was arranged
when the same process was followed. This second test was never completed and it
was therefore not possible to establish the existence of this complaint or its possible
cause. It was during this interaction with Mr Mabasa that he took to social media and
expressed his unhappiness with the vehicle and his engagements with the Audi brand
in general.
Offers made to Mr Mabasa

After the overheating incident in February, Audi South Africa met with Mr Mabasa in
Cape Town, and, although not being under any legal obligation to do so, confirmed
that as a gesture of goodwill it was prepared to propose a resolution for the purpose of
addressing his concerns.

This took the form of an offer made to Mr Mabasa which included two options, these
being:

1. Offer to repurchase the Audi TT in excess of its market value, or


2. Offer to replace his car with a like-for-like / similar (or lower) mileage,
specification and age

Neither option was acceptable to Mr Mabasa who advised that the proposal by Audi SA
would leave him in an unfavourable financial position, as it was insufficient to settle the
outstanding extent of his financing obligation. As an alternative Mr Mabasa suggested
a new Audi A5 as his preferred replacement vehicle. Audi South Africa investigated
this option, but declined to proceed as this was substantially in excess of the value of
his vehicle, which was at that stage three years old with an odometer reading in
excess of 80000km.

Mr Mabasa elected to continue using his current Audi TT.

Fire investigation

In March this year, Mr Mabasa informed Audi South Africa that his Audi TT was on fire.
His account of events was that he was driving and smelt an electrical burning smell
inside the car, he stopped on the side of the road, got out of the vehicle to relieve
himself and when he returned to the car he saw smoke coming from the dashboard of
the vehicle, he immediately tried to get inside the vehicle in order to recover his
belongings. The vehicle would not unlock, he tried to break the window and retrieve
some of his belongings but could not do so. The Audi TT subsequently burnt to
destruction.

Audi South Africa contacted Mr Mabasa’s insurers and arranged for a tow truck to
assist him. As a result of the incident and because any claims of fire are taken very
seriously by the Brand, Audi South Africa followed the standard Safety Investigation
Protocol, which included the following:

• Contact was made with Audi headquarters to determine any other fire-related
instances which may have occurred elsewhere in the world. No other similar or
related fire instances were discovered. Audi South Africa was also advised that
due to the vehicle mileage (80 000 KM), it was unlikely that the fire was
attributable to any factory fault, which if it existed, would have become manifest at
a far earlier stage in the vehicle life.

• An internal investigation by a Volkswagen Group South Africa investigator was


commissioned to look into this case.
• Audi South Africa commissioned an independent investigator, Dr Klatzow, who is a
well-recognised forensic scientist in South Africa, to also participate in the
investigation and provide a detailed report.

The following summarises the conclusions of the fire investigation from all parties
concerned:

• Vehicle burnt to destruction – this made it difficult to use significant parts of the
vehicle to draw conclusions around the source of the fire.

• Usually with internal causes of a vehicle fire, the fire would be contained to the
specific area. In this case, the entire vehicle had burnt out.

• This was an unattended fire – fire services arrived after vehicle burn out and most
evidence is then lost.

• An after-market tracking device was fitted to the vehicle. Although it could not be
established that this contributed to the fire, the wiring utilised for the purpose of
fitting the aftermarket device did not conform to that which corresponded with the
standard of the wiring utilised in the Audi TT. Dr Klatzow did express concern
relating to the nature of this fitment.

• No evidence of a vehicle manufacturing fault could be found.

A full investigation report has been disclosed.

Mr Mabasa’s further demands

Further demands which were subsequently received by Mr Mabasa are the following:

• On 4 June 2018 Mr Mabasa demanded that Audi South Africa pay the full amount
of the outstanding balance on his “vehicle write-off” and in addition meet the costs
associated with the loss of a laptop, his clothes and his Nikon camera and books
lost in the fire.

• He further advised Audi South Africa telephonically on the same day that although
his insurance had agreed to pay him out it was not enough to settle the “financial
matters” and that he required Audi South Africa to “come to the party” or he would
“go public”.

• In response to Audi South Africa’s request that he advise of the extent of the
shortfall and the extent to which it arose from the manner in which the vehicle was
financed, Mr Mabasa replied on 9 June 2018 that he had “disclosed everything
materially important” and that he would “see you in court, but your atrocities need
to be disclosed to the general public and I am doing just that”.

• Following on his being contacted telephonically and advised by Audi South Africa
that, without prejudice to any of its rights, it remained willing to consider resolution
of the matter against substantiation of the losses which he contends that he
suffered, he replied on 13 June 2018 advising that the losses he had suffered
“cannot be easily quantified” and that he demanded that he be paid a total amount
of R528 000.00, against payment of which he would remove all content pertaining
to Audi South Africa on social media platforms and would not publish any further
comment on the matter.

Further resolution attempts

The Head of Brand at Audi SA (Trevor Hill) made direct contact with Mr Mabasa in an
effort to arrive at a resolution of this issue. It was again emphasised that for purposes
of good governance it was necessary to secure substantiation of the losses which he
alleged that he had suffered, which Audi SA was prepared to consider as a gesture of
goodwill, and despite the fact that no fault could be attributed to Audi SA. Mr Mabasa
advised that he is not prepared to substantiate his losses and persisted in his demand
for payment of a lump sum amount for which there is no legal and/or ethical basis for
compensation.

In a further effort to try and resolve the matter, Audi SA proposed to Mr Mabasa that a
facilitator be appointed with a view to achieving a consensual outcome. Audi SA
suggested that Mr Mabasa nominate three persons for this purpose (with Advocates
being suggested as persons who possess the necessary skills), of which Audi SA
would select one and would cover the associated legal costs. The mandate of the
facilitator would be that of considering the representations by the respective parties
and making a non-binding recommendation. Mr Mabasa rejected this offer advising
Audi SA as follows:

Conclusion

Subsequently, we have been advised that Mr Mabasa has paid by his insurers based
on the market value of the vehicle, including certain options on the vehicle. He is not
entitled to double compensation for the loss of the vehicle. Mr Mabasa claims that this
amount is not sufficient and has made demands on Audi South Africa to compensate
him, but has not quantified any amount (and the legal basis) which he alleges is due to
him. Mr Mabasa is adamant that the cause of the fire is related to vehicle defect on his
Audi TT and his life has been at risk because of that.

In considering all the facts of the matter, there is reasonable doubt regarding Mr
Mabasa’s claims against Audi. There are various factors that are unusual in Mr
Mabasa’s claims and case against Audi. These include:

• Mr Mabasa’s financial obligations in over-financing his Audi TT while being fully


aware of the predicament which he was getting himself into i.e. the same
predicament he faced when he traded his BMW in on the Audi TT. His failure to
acknowledge or disclose this predicament even though he signed a document to
this effect.
• Mr Mabasa’s unwillingness to accept any of Audi South Africa’s offers to
repurchase or replace a vehicle to which he was not satisfied with because of the
extent of the problems experienced.

• Mr Mabasa’s social media threats and behaviour without meeting or engaging with
Audi South Africa to explore whether an amicable settlement was possible. He
has made direct threats to bring the Audi Brand down and has also documented
only one side of this case on a public forum. As you are no doubt aware, brands
such as Audi do everything reasonably possible to avoid adverse publicity of the
nature caused by Mr Mabasa, but are confined to dealing with the matter on an
ethical and business basis.

• Detailed and thorough investigation process was concluded and does not point to
vehicle fault.

• The failure of Mr Mabasa to date to quantify his alleged losses for which he
believes Audi South Africa is responsible.

• Audi South Africa is of the view that none of the technical problems referred to by
Mr Mabasa could have been the cause of the fire.

• Mr Mabasa’s rejection of an offer to have a third party facilitate the matter.

Audi South Africa realises and took full responsibility for resolving Mr Mabasa’s
technical issues from the beginning. Audi South Africa has honoured all obligations to
the customer as part of the Audi Freeway Plan and has also offered different solutions
to Mr Mabasa in rectifying his negative purchase experience.

Audi South Africa has suffered great reputational damage on social media as a result
of Mr Mabasa’s speculative comments. With reference to the Audi coolant pump
campaign which Mr Mabasa has eluded to his specific case - this recall is to replace a
coolant pump which can become blocked with debris from the cooling system. The
models affected are Audi A4, A5, Q5 and A6 with the 2.0l TFSI engine produced
between 2012 and 2017. The recall affects approximately 1.16 million Audi vehicles
worldwide and does not affect any Audi TT models. Also, all other fire related cases in
South Africa have their own specific facts and technical circumstances applicable and
there is no relation whatsoever to that of Mr Mabasa’s case.

The position of Audi SA

Audi SA is satisfied that it took all steps necessary to addressing in an appropriate


manner, the shortcomings which formed the subject matter of Mr Mabasa’s complaints
in relation to the vehicle prior to its destruction. These included Audi SA’s undertaking,
without being under any obligation to do so, to replace the vehicle on the basis set out
above.

Audi SA is equally satisfied that following upon the destruction of the vehicle it has
made every reasonable endeavour to provide a solution which will resolve Mr
Mabasa’s ongoing dissatisfaction.
It nevertheless appears that Mr Mabasa seeks to use the adverse publicity arising from
his social media posts in the hope of compelling Audi SA to effect payment of the
amount which he demands in order to purchase his silence.

Audi SA will neither subscribe or accede to extortionate behaviour of this nature.

We remain willing to disclose all related documents to substantiate the issues dealt
with above to enable an informed and balanced view to be formed of the matter.

This includes:
• Mr Mabasa’s sales transactions – invoice and waivers signed
Please note that the sales transaction documents and waivers signed are
available for your review and to provide substantiation of Audi South Africa’s
comments to this case, which are also confirmed in Mr Klatzow’s report
• Full servicing history for Mr Mabasa’s Audi TT
• All legal communications including offers sent to Mr Mabasa
• The full investigation report by Mr Klatzow

If you intend to publish, please ensure that this response is published in its entirety in
order to present a balanced perspective to the public and to avoid the negative
consequences of the defamatory statements that have been made by Mr Mabasa.

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