German Car Zone

The United States is key to Volkswagen's planned expansion in the coming decade, as the German automaker attempts to rival Toyota by selling one million units in the U.S. per year by 2018. That lofty goal will be fueled by new products priced below their current counterparts, and according to VW Group CEO Martin Winterkorn, many of these new models will be built Stateside and in Mexico.

One of the major product changes will come in the form of the Passat, which will ditch its current nameplate, decrease in size and be priced around $20,000. The Jetta will also see a price reduction from the current base model's $17,030 sticker to something closer to the $15,000 price-point, while some version of the Polo – expected to be built in North America to keep costs down – will slot in below VW's entry-level sedan. Other models slated for sale in the U.S. include a compact model based on the up! concepts, as well as a body-on-frame pickup truck and the return of the Phaeton, motivated by a V8 powerplant and priced substantially below the slow-selling version that was killed in 2005.

Source: Automotive News via Autoblog
VW's plan for the U.S. include smaller Passat replacement, pickup and more - Autoblog

Volkswagen's plan to sell one million vehicles annually by 2018 does sound ambitious, but according to an Automotive News report, Volkswagen CEO Martin Winterkorn has some ideas revolving around the U.S. that could get the German automaker to their goal of matching Toyota's sales.

A large part of Winterkorn's plan is selling cars in the U.S. that appeal more to American customers. That, according to the report, means smaller, cheaper automobiles, and ultimately bringing a car around the size of the European Polo stateside. U.S. Volkswagen dealers are said to be desperate for a car to compete with Honda's hot-selling Fit, and the new VW model would be designed to go head-to-head with the Japanese compact.

Winterkorn also noted that the Jetta and Passat have been priced out of their markets in the U.S., necessitating replacements that may be built exclusively for North America. Winterkorn would like to see the Passat starting in the $20,000 range (the base Passat is currently almost $25,000) and the Jetta start around $15,000 (currently over $17,000).

The Jetta replacement could be built at the Puebla, Mexico plant that is currently reaching capacity, while the Passat successor would likely be built at a new plant, locations for which are currently being scouted out in Georgia, North Carolina, and South Carolina. The new U.S. plant could also be capable of building a new small car, as Winterkorn has commented that to import European-built Polos would not be cost effective. The recently show VW Space Up! small car concepts have also been considered for production, but they have only been approved for sale in Europe, not the U.S.

Winterkorn is also still mulling over the possibility of returning the Phaeton luxury sedan to the U.S. market. The first Phaeton was not a success for Volkswagen in the U.S., though the car soldiered on in Europe. Winterkorn says the new Phaeton would likely be V-8 and possibly diesel powered, though it will likely not be as large as the old W-12 powered car. Winterkorn believes Volkswagen needs a flagship model such as the Phaeton and would place it just above the upcoming Passat CC sedan in the Volkswagen lineup -- should the numbers work out.

Other Winterkorn musings included the need for a better Toureg next time around, the possibility of selling a midsize pickup truck in the U.S. around the end of the decade, and creating a Volkswagen-made successor to the upcoming Chrysler-based Routan -- a possibility, should Volkswagen actually build a U.S. plant and have it running within the next few years.

Do you think current Volkswagen models are too expensive for U.S. consumers, or do most people who buy Volkswagens do so due to a slightly elevated status above comparable Toyotas and Hondas? Volkswagens are typically known for their upscale build level relative to their price, but cheaper trim will likley be an essential element of going downmarket with their automobiles. Is that a smart move? And lastly, will the Polo and Phaeton sell in the U.S.? Is it poor marketing to sell vehicles that represent both the entry and upper level markets?


VW eyeing smaller, cheaper cars for U.S., would they sell? | Car News Blog at Motor Trend


Sounds like VW is finally going to re-think and act specifically to the U.S. market. A Passat simply shouldn't cost 38-40K with everything on it when the competition doesn't.

M

Tell me if anything new is written here ?

I'm sick of VWoA repetitiveness just do it already

Pickup truck is not fully confirmed yet but this is encouraging coming from Winterkorn.

The Associated Press
Published: March 7, 2008

WASHINGTON: Volkswagen's chief of North American operations on Friday outlined plans to more than triple sales of the German automaker's brands in the United States over the next decade through aggressive marketing and by taking advantage of growing demand for clean diesel fuel.

Stefan Jacoby, chief executive of Volkswagen Group of America, said his goal is to sell 1 million vehicles annually by 2018 — 800,000 from the Volkswagen brand and 200,000 from the Audi brand. That would be a sharp increase from 2007, when the company sold 235,000 Volkswagens and 94,000 Audis. It also would reverse a downward trend. In 2002, the company sold 338,000 Volkswagen brand cars in the U.S.

Volkswagen is the fourth-largest automaker in the world, but in the U.S. it controls only 2 percent of the market. The company has made the U.S. market a top priority and is overhauling operations here. Its North American headquarters are moving next month from suburban Detroit to northern Virginia — a move the company says brings it closer to its East Coast customer base.

The company also is considering establishing its first production plant in the U.S. In informal remarks to reporters, Jacoby said an exact location has not been chosen but that "we will have that facility here in the U.S."

He later backed off those remarks, saying he was not prepared to definitively announce that Volkswagen will build a plant in the United States.

In his speech at the National Press Club, Jacoby said he believes Volkswagen is well positioned to take advantage of an anticipated increase in demand for cars with diesel engines. He cited a J.D. Power study predicting the diesel car market will increase from 3 percent to 7 percent of the U.S. passenger vehicle market by 2012 as consumers look for better fuel economy and reduced emissions and automakers look to comply with laws mandating more fuel-efficient fleets.

"Diesel is back," said Jacoby, who noted Volkswagen's traditional strength in the diesel car market. "We see clean diesel at a tipping point."

Jacoby likened Volkswagen's struggles in the U.S. to "a puzzle of a thousand pieces," with some products unsuited to consumer tastes and misdirected marketing efforts.

The Audi brand, he said, needs to be driven toward the premium market, the niche occupied by BMW and similar brands.

As for the VW brand, he said "it's been directed too much toward a niche brand, not the major brand for the wide American consumer base."

Jacoby said in the few months he's served as head of American operations he has learned that the VW brand has a place in American pop culture and an opportunity exists to capitalize on that. More than 1,000 people attended a job fair Thursday looking for one of 280 openings expected when the headquarters moves to Herndon, Virginia.

He also joked that he is still adjusting to American automotive habits, which like other countries have their own unique quirks.

"It's driving behavior. It's speed limits. ... it's the sizes of cars. I'm always surprised to see in my rearview mirror a beautiful woman doing her makeup. I'm very afraid and pull over to the right," Jacoby said.

He said he did not expect recently announced plans by Porsche to increase its stake in the company from 31 percent to a majority share to affect plans in the U.S., since Porsche already was represented on the board that approved the new American strategy.

Though Porsche would control a majority of Volkswagen AG, it has said repeatedly that it has no plans to merge the companies.


Volkswagen US chief outlines plans, sees opportunities in diesel - International Herald Tribune

Interesting. It isn't so much the product, but their prices. I really believe more Americans would buy VWs if they were priced better, had more dealers and better dealer services. Word of mouth about VW dealer's awful service has likely kept some away.


Bingo. Passat CC, Phaeton, Touareg all priced and aimed at a different customer from the Toyota, Honda, Nissan, Ford, Chevy, Hyundai customers VW needs for big sales numbers.

M

Was the Toureg a flop as well? How are the touaregs sales in the usa? and the rest of the World..? In South Africa sales are verry low andis verry overpriced..

No the Touareg wasn't a flop per say, but it wasn't a runaway hit either. I personally have always liked it, especially the interior. However the new ML, X5, Range Rover, RR Sport and other regular price/brand SUVs took the spotlight away from it and it never recovered. Pricing is somewhat and issue, but then again it isn't. SUVs from Ford, Chevy can cost just as much so I think lack of promotion, VW'w quality rep and dealer problems hobbled the Touareg more than anything, IMO. It is a great SUV, but there are better ones.

M

I think all the Touareg needs is a better exterior Look and some Muscle....