Volkswagen Sees US Market As Key To Redemption

Herbert Diess, the current head of Volkswagen, told the press in Germany last week, “We believe that the USA has in fact the greatest potential for Volkswagen worldwide in the next decade,” He added, “Naturally not in the near future, since we are starting from zero in the U.S.” His remarks came as part of a discussion about how to craft a new brand strategy for the German automaker in the the US.


vollkswagen coupe gte concept
Volkswagen Coupe GTE concept. Source: Volkswagen

Diess acknowledged that his company “didn’t succeed in giving the brand a clear profile and consistent product portfolio that could allow us to expand step by step in the market.”. He said Volkswagen needs to target what he called the “aspirational middle class.”

Company officials say customers have been confused by the lack of a clear sales strategy in the American market. For years, VW has vacillated between targeting the near premium and the mass market. The prime example is the now defunct Volkswagen Phaeton which started life as a 12 cylinder luxury sedan. VW is now attempting to sort out exactly how to position its Audi and Porsche brands in the US market so they do not compete for sales with each other. That product realignment strategy is expected to be completed by the end of June.

The company has been late to the highly profitable crossover and SUV party. It will build a new midsize crossover at its factory in Chattanooga soon. It will also introduce a long wheelbase, 7 passenger version of  the Tiguan shortly. Diess believes there are lots of Americans who still have fond memories of Volkswagens from the past, especially the original Beetle and the iconic Microbus. “All that leads me to believe that were we to work the market with the necessary consistency and focus, there is in fact clearly a big growth potential,” Diess says.

The backdrop for all this happy talk, or course, is the question of how Volkswagen intends to resolve its legal and financial difficulties relating to its diesel emissions scandal in the US. Although it agreed last week to set aside $10 billion to resolve all claims, US customers who own diesel powered Volkswagen products still have no clear idea how their complaints against the company will be resolved.

“We are working hard to reach a settlement on both, since we would love to quickly put this behind us,” said Manfred Doess, head of group legal affairs at Volkswagen, speaking to reporters in Stuttgart recently. Asked if a resolution would happen this year, he replied, “I consider it highly probable. But it would be highly speculative at this point to say whether it would be in the second, third or fourth quarter.”

Source: Automotive News



Steve Hanley

Closely following the transition from internal combustion to electricity. Whether it's cars, trucks, ships, or airplanes, sustainability is the key. Please follow me on Google + and Twitter.