Volkswagen drops price on U.S. Jetta
Volkswagen's best-selling car in the U.S. will become even more attractive to car buyers in the 2007 model year, as the base price for the sedan drops by $1,410, to $17,105 (including shipping).The low-priced version will lose some of the features in the more-expensive 2006 base version.
VW has decided to move a little down-market in terms of product positioning in the U.S. market, going back to its roots as a volume producer of more economical cars. The cheaper Jetta will line up alongside the new Rabbit, which stickers about $1,000 less than the 2006 Golf.
[Source: Reuters]
Reader Comments (Page 1 of 1)
Michael Karesh 1:50PM (6/19/2006)
If the past is any indication, they'll take about the same value out of the standard features list. So if you get a car with the same number of features, you'll spend about as much or a bit more.
They might also be reducing dealer margins. Many manufacturers have been effectively raising their revenue per vehicles while cutting sticker prices this way.
My article on this tactic:
http://localhost/pieces/pricing_game.php
My site makes the amount to which prices have actually changed much clearer. 2007 VW prices soon, assuming full feature and price lists are available.
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bhtooefr 1:59PM (6/19/2006)
VW's said that profits (for both dealers and themselves) are going to drop by under 1% per vehicle when they do this... someone on VWvortex said so, anyway... so not much of a difference in profits.
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Lithous 2:06PM (6/19/2006)
"My article on this tactic:
http://localhost/pieces/pricing_game.php"
Nope, I restarted my Web Server 3 times and still can't see your link. Maybe you try FTPing the files to my machine again. ;)
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Dave T. 2:07PM (6/19/2006)
But the real interesting part of the story, and its automotive news source, is that VW has accepted it won't be competing on the Phaeton level in the future. So the Passat will once again be the top model in the line. And that lost cost is what made them so attractive to americans in the first place.
So they're once again going to aim at being an affordable German make.
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Peter 2:16PM (6/19/2006)
Great news, assuming it's possible to find one of the base models.
I spent quite some time in a local VW dealer last September buying a 2001 Jetta for my stepdaughter. The 2006.5 Jettas were new on the market at the time, but the dealership must've had at least 25 of them in the showroom and on the lot. Almost every one of them had leather and alloys and other options, and was stickered, as best I can recall, upwards of $23K. The "Value Edition" models were nowhere to be seen. The same was true, by the way, of the new Passats.
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Peter 2:18PM (6/19/2006)
"So the Passat will once again be the top model in the line."
What about the Touareg?
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jscro 2:24PM (6/19/2006)
Smart move on VW's part. I've always been a fan of VW, but they just don't have the clout to move up market; especially with Audi marketing cars like the A3 and the rumored A2.
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Takeo 2:27PM (6/19/2006)
Still over-priced and under-qualitied.
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kwc 2:36PM (6/19/2006)
I hope in that "decontenting" they put cloth seats back in these things. Some of us really don't care for leather or "leatherette" seats (esp. since I live in Florida!!) My husband and I looked at one last year and crossed it off our buying list since we couldn't get cloth with the sunroof and alloys.
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Colin 2:42PM (6/19/2006)
""My article on this tactic:
http://localhost/pieces/pricing_game.php"
Nope, I restarted my Web Server 3 times and still can't see your link. Maybe you try FTPing the files to my machine again. ;)"
Yes, please ftp again. I also do not have the files - please try ftp://n00b:1234@localhost
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Richard Warren 3:44PM (6/19/2006)
Good move on their part.
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Gooch 4:03PM (6/19/2006)
My favorite VW was my 1986 GTI that had a manual sunroof, cloth seats, A/C and an AM/FM cassette -- nothing else. No power windows, no cruise, no power steering and little bitty 14" wheels that really didn't look that small back then.
My 01 GTI GLS was loaded with everything, but no matter what I did to it, the only thing it did better than my '86 was cruise at high speed and make me lazy with all of its power features.
My point is VW not only needs to decontent and reduce prices, it needs to bring back the spirit of the old GTI. The new one is amazing (much tighter than my 2001, which I actually thought was pretty tight itself), but it lacks that little something my 86 had in spades -- character. I'd still buy one in a minute, and if it had a hand-crank sunroof and windows, and locks that I raise and lower by hand, all the better.
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Michael Karesh 4:06PM (6/19/2006)
Very funny, guys.
Yeah, I messed up by copying and pasting the url from the version of my site running on my home machine.
The corrected link:
http://www.truedelta.com/pieces/pricing_game.php
Again, I don't know if VW is using this tactic, but expect it given current trends.
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Alan 9:04PM (6/19/2006)
They need to play the value proposition. The MkV is much-improved over the MkIV, and if warranty claims are anything to go by, they've improved in terms of reliability as well. The jury's still out until the Consumer Reports surveys come out, though.
In any case, they can do a fair amount of de-contenting, particularly at the Value Edition level. It's interesting what they've done with the Rabbit. With cloth seats, they've been able to reduce the price, while still providing a fair amount of content (the comparison to the Civic is quite favorable).
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iQuack 1:45AM (6/21/2006)
Because VW's service record has been so lousy, they'll have to discount their cars more than would otherwise be necessary.
Just meeting the price of a Honda or Toyota won't be enough. Most car buyers know they'd be better off with a Honda, Toyota, or perhaps a domestic brand.
There is nothing compelling about VW cars except "German engineering" of which much is manufactured in Mexico.
There's nothing wrong with building cars in Mexico, but any mystique that's supposed to result from "German engineering" is quite a load of crap.
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Dave 11:40PM (6/23/2006)
Last week I purchased a 2006 rabbit-4door. Let me correct a few myths.
1. The Rabbit is built in Germany.
2. The fit/finish is >= the Honda Civic.
3. The Rabbit/Golf is many times more enjoyable to drive than the Civic!
4. The Rabbit/Golf came with many standard features not found on the Civic.
5. The The Rabbit/Golf made rear side thorax airbags as an option. The Civic did not offer this option.
6.The Golf/Jetta owners I talk to, have not indicated any problems with their car.
7.I am really pleased with the product and my choice of vehicle.
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