Warranty repairs are paid at a lower rate, with set labour times, as well as a lot of the margin stripped out of the parts (virtually charged out at cost price in most cases).
All dealerships are on different warranty labour rates, which are dependant on various factors like technician qualifications (manufacturer-based training), customer satisfaction scores, and several other conditions.
It's not a simple case of a dealer refusing to do warranty repairs because they don't want to. It hurts their bottom line, sure. But if the car is under warranty, and it is deemed to have a warrantable fault, then they're pretty much obligated to fix it. That's what they signed up for, when they took the franchise on.
'07 Transporter 1.9 TDI
'01 Beetle 2.0
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