Volkswagen has announced that it plans to sell 1 million units in the United States by 2018. VW also said that it would focus on four core vehicles. The plan includes increasing VW’s sales to 800,000 — more than triple its 2006 sales of 235,140 — and increasing Audi’s sales to 200,000 — up from 90,116 last year.
VW will also shift its price point while still trying to be a premium brand. According to Automotive News, its lineup will be priced about 5% above its U.S. and Japanese competition, rather than the current 10%.
VW will also move its focus from several niche market vehicles to four core vehicles designed and targeted for the U.S. market, says Stefan Jacoby, CEO of Volkswagen of America. Jacoby also said that the core vehicles will include two volume sedans — replacing the Jetta and the Passat and aimed at competitors like the Honda Civic and Accord — the recently unveiled Tiguan SUV — set to hit the U.S. market next year — and a new mid-sized SUV. The four vehicles are expected to account for as much as 600,000 of VW’s U.S. sales
VW is also considering a U.S. plant to build such vehicles.
VW has pushed too hard into niches, says Jacoby. “We need to come back to our original roots as the “people’s car’ and “driver’s wanted.’ I don’t want to bring back those campaigns or tag lines, but we have to re-evaluate our position. We have good products but from an engineering point of view, they do not fit the market,” he admits. “They are over engineered and made for high-speed performance for the European driving environment.”
VW will continue to make niche vehicles like the Rabbit, GTI and upcoming Passat coupe, Jacoby said.
VW’s North American operations lost $843.9 million last year but is hoping to break even in 2009 and turn a profit by 2010.
09/17, 10:15 AM
posted by:
TomF
“We need to come back to our original roots as ‘the people’s car’ and ‘drivers wanted’?” Jesus Christ. The first line goes back to Hitler and the second is from the 1990s — not exactly VW’s “original roots.”
They CAN’T go back to the 1960s because the market surrounding VW is totally different. In the ’60s VW sold one bread-and-butter car and a couple of niche vehicles (microbus, Squareback, Karmann, etc.) against a small morass of American monster-cars. Relibility was a minor issue and there was no Asian competition. Running a “roots play” today will get them killed. You could argue that what they are doing NOW — complementing the Asians’ leadership in passenger cars, slotting in underneath Euro luxury brands, and avoiding a serious challenge to the US lead in trucks/SUVs — is exactly the right strategy.
They sure as hell aren’t going to out-Camcord the Camcord.
09/17, 10:50 AM
posted by:
Hyperlite
Tell you what, i went a played around on the VW site for a while the other day, built an R32, a GTI, and a GLI….those are some great looking cars.
09/17, 10:51 AM
posted by:
autonut
Good point Tom. If PeoplesCar want to sell 1 mil vehicles and population of US will not dramatically surge in the next 12 years, they have to erode someone else’s sale. Considering outstanding quality of their fleet it sounds like a marketing game, NOT. I suspect illegitimate offspring of Fuhrer has a seat on the board and infects the rest of them with his illusions.
09/17, 11:01 AM
posted by:
Hari
“he admits. “They are over engineered and made for high-speed performance for the European driving environment.””
Grrrr… He admits that most Americans don’t want real cars. That why we end up with a bunch of automatic transmission, overweight, non-handling crap! It’s attitudes like this that make me want to drive my 15 year old 5-series forever.
09/17, 11:18 AM
posted by:
R1GHT30U5
“They are over engineered and made for high-speed performance for the European driving environment.”
This statement also worries me. This is exactly the kind of thinking that got Benz in trouble a few years back with their build quality.
Cutting their selling price is a good idea but if they are going to be 5% over the Japanese with their poor quality I dont see them having alot of luck there. I think building a US plant will increase their quality over the Mexico division though.
VW,
1. Quality up
2. Price down
3. Profit
Good luck!
09/17, 11:23 AM
posted by:
RicardoHead
Lower the prices, improve the reliability, and make the vehicles noticable and VW has a shot. Keep selling overpriced poor quality crap and they may as well stay in Europe where that junk sells.
09/17, 1:11 PM
posted by:
autonut
VW does not sell in Europe as much as they wantl either. Lower segment A & B is taken over by Toyota/Honda/Nissan/Koreans; they do not have micro cars; European compact and sub-compact classes are seeing resurgence from France and Fiat group plus Ford, GM and usual suspects Toyota/Honda/Nissan/Koreans. You really don’t notice that many “Fuhrer presents to people” anymore. There are quite a few taxis made by Skoda (WV subsidiary) in poorer countries of Europe and Audi diesels in Austria and Germany. But even in Austria and Germany there mush more Benzes taxis and BMW diesels (or at least that is what I observed without actually counting them). Their market share is way off since 70-80-90’s when French automakers and Fiat were in trouble and Japanese did not invade full force.
09/17, 1:31 PM
posted by:
TOZO
VW is on some serious crack! Sales of 800,000 VWs & 200,000 Audis in the US? Don’t forget sales of 50,000 Bentleys, & 20,000 Lambos, & 5,000 Bugattis while you’re dreaming!
VW (the 18th best selling auto brand in 2006 & also 2007 so far - and outsold by #16 Mercedes & #14 BMW! [2006 rank]) at sales of 800,000 would become the #7 brand barely under #6 Nissan and the current #7 Chrysler under that crazy theory. And audi: Audi plans to sell as many autos as VW sells now!?
09/17, 2:03 PM
posted by:
1487_GM_SALES
Across the country, Tow truck companies are gitty with delight.
09/17, 3:13 PM
posted by:
Commodore
Big dreams is all I hear.
09/17, 11:14 PM
posted by:
AMGoff
yeah.. you work on that veedub.. let me know how it works out…
09/18, 11:24 AM
posted by:
Cire
I think they do need to change their focus. The Euro-luxury wannabe image didn’t quite fit (especially with the poor reliability issue). The Phaeton was the poster child for the failure of this image for VW (anonymous looking luxury barge from a nonluxury brand). If VW can fix its reliability issues and offer mainstream vehicles with a European edge in styling and performance, then it might improve its fortunes in the U.S. market.
I do agree with some of the other forum members about the statement about overengineered vehicles geared towards performance. I don’t think VW should resort to offering cheap, boring cars in its bid to increase market share. They should look to other mainstream manufacturers to build a business model; they should not try to directly replicate their products and lose their German/Euro identity. The main problem with the current Jetta is that it looks like a Corolla-wannabe minus the reliability.
09/22, 10:11 AM
posted by:
BLISS
GO AT IT VOLKSWAGEN AG.