• Image Credit: Drew Phillips
  • Image Credit: Drew Phillips
  • Image Credit: Drew Phillips
  • Image Credit: Drew Phillips
  • Image Credit: Drew Phillips
  • Image Credit: Drew Phillips
  • Image Credit: Drew Phillips
  • Image Credit: Drew Phillips
  • Image Credit: Drew Phillips
  • Image Credit: Drew Phillips
  • Image Credit: Drew Phillips
  • Image Credit: Drew Phillips
  • Image Credit: Drew Phillips
  • Image Credit: Drew Phillips
The Volkswagen brand sold 407,704 cars last year, a 6.95-percent decline compared to 2012, and it's down a further 8.36 percent through the end of April 2014 compared to this time last year. In order to to put the sales football between its Strategy 2018 goal posts, the brand would need to add 100,000 more sales every year to achieve the lofty 800,000-unit target. Coming to grips with how unreasonable that is, VW US CEO Michael Horn has said, "For now, we have to have realistic targets."

The reasons for the brand's slow-down are imprecise, but lots of folks are throwing lots of reasons around. Last November, VW Group Chairman Ferdinand Piech told Bloomberg, "We understand Europe, we understand China and we understand Brazil, [but] we only understand the US to a certain degree so far." Analysts say the brand hasn't had midsize and compact SUV offerings, especially an overdue retail version of the CrossBlue, and the ones it does have are priced too high for their segments. It "didn't introduce enough new engines, or alternative technologies or model variants" for the Passat and Jetta. It devoted so many resources to China that the US market suffered. It was being outspent two-to-one on advertising by competitors. Its J.D. Power dependability ratings aren't high enough to overcome its past. It "has never really taken the US customer seriously." And so on.

There's still no official admission of defeat concerning the target, but reading between the lines there are some VW execs that appear to accept it won't happen short of some deus ex machina. Still,
Horn told TheDetroitBureau.com, "The vision is right... long-term. But timing is the huge challenge."


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  • 118 Comments
      tenspeeder
      • 10 Months Ago
      If they want to be a volume player, they need to mimic the other volume players. The number of people who want/appreciate German engineering is limited (except in blog posts). - Offer AWD as an option on the Jetta sedan on all model levels. Add to Passat (Screw Audi) - Develop a true competitor to the Escape/Forester/CR-V etc. Tiguan's a failure - Lead rather than follow. Bring over the midsize pickup and grow the market - Fix your reliability reputation issue. Offer a Hyundai/Kia like warranty program and stand behind your products - Promote more dealer open house events. Most of the dealerships around me are new or have been remodeled to be new. Never see them being promoted like Toyota, Honda, Ford do - Stop highlighting bland colors in your advertisements - Produce some new advertisements. Why are we still seeing commercials that are > 2 years old - Rename 'leatherettte'. It comes across as low quality whether it feel nice or not. Americans want leather
        Mike Lowvw Krause
        • 10 Months Ago
        @tenspeeder
        a diesel Amarok I think would do well.
        JaredN
        • 10 Months Ago
        @tenspeeder
        AWD isn't necessary for them to reach volume. Mercedes and BMW need AWD to sell in the northern parts of the US because they are RWD cars otherwise. Front-wheel-drive cars do just fine in this market. VW doesn't need to compete directly with Mercedes and BMW -- they have Audi for that.
        SloopJohnB
        • 10 Months Ago
        @tenspeeder
        LOL…(except in blog posts)!
      Matt
      • 10 Months Ago
      Make me the CEO of VW, and here's my roadmap: -Offer 10yr/100k warranties on everything -Make a CRV/Rav4 competitor -Make a 3-row crossover (crossblue) -Sell the Amarok in the US. Build it in the US south somewhere. -Flesh out the Sportwagen lineup to attack Subaru on all levels -Invest heavily in the Jetta/Passat to get them current, and give them some actual style (think Mazda) -Continue to offer diesels and manuals all over the lineup Do the above, and I guarantee 800k sales by 2020.
        SethG
        • 10 Months Ago
        @Matt
        -Can VW afford to stand behind a 10yr/100K warranty? -They have a CRV competitor. It's just too expensive or not better in enough ways to justify a premium price. -Any company with these types of aggressive sales goals needs to have a three-row crossover. -Amarok is cool but doesn't fit well into the US brand which has different perceptions/expectations. -If Audi can do the allroad, VW should be able to lift these cars. -I'd like to see diesels and manuals but I'm not sure either is the ticket to increasing sales.
      jjmoonen
      • 10 Months Ago
      HAHA!! Reality is a bugger isn't it VW.
      billy_sims33
      • 10 Months Ago
      It's not that VWoA doesn't understand the US market, VWoA doesn't want to listen and learn. Herndon VA's completely disregards feedback from VW owners and the domestic US market. VWoA's our way or the highway management has failed spectacularly and now they want to "fix" their sales estimates when they should be fixing their vehicle lines and marketing philosophy. This is not the first time Volkswagen has failed to keep current with US marketing trends. The last time it was Ridiculous Rabbits manufactured in Westmoreland PA. A quick visit to www.vw.com - VWoA's new website will immediately reveal what is wrong with VWoA's approach to the US market - you will see marketing pap and be directed to existing dealer inventories........
      rcavaretti
      • 10 Months Ago
      Excel, like any good spreadsheet program, does allow you to input negative numbers. I suppose they'll be wearing out that negative key.
      BodyBlue
      • 10 Months Ago
      I love it! Are they really that dumb that the just now realize that making dreary looking cars that cost too much and have dreadful reliability and dealers that are among the worst is hurting their sales? Typical German arrogance. The Euro-lemmings screech and yell and make excuses about VW but the truth is that Americans are proving to be far to smart to be fooled by VW and that makes them mad. Now all of the scumbag paid for posters from the Acura thread will be on here voting and spinning like crazy.....doing the bidding of their German masters.
        edselfanboy
        • 10 Months Ago
        @BodyBlue
        I think you may mean Audi, not Acura. VW's biggest problem is Econ 101: Dollar weak, Euro strong. Luxury cars can get away with higher prices; not so much for VW. I'm an old guy with an everyday 2013 Lexus and a 2004 VWr32 toy. The Lexus is nice, but boring. The VW is less reliable, but makes me smile. With my wife's ok I'm getting a a MK7 Golf R next year, if I'm still around. Reliability, either real or perceived, is great, how a car feels to you can also important Is this a site for people who love cars, not appliances?.
      Mike Lowvw Krause
      • 10 Months Ago
      Is it that hard to make diesels available in all models? diesel hybrid? and whats all this relase the new car in europe in 2014 and U.S. sees it in 2016? treat america like a car buying nation and not a 3rd world country. color options, roof options and radio options should be standard on all models, especially with your fancy new MBQ platform design. get it together VWoA
      b.rn
      • 10 Months Ago
      Relax ambitious sales targets? We used to call that not meeting projections. I guess this is a bit softer.
      cgm9999
      • 10 Months Ago
      Hoo boy, where to start... When I owned them, I loved my VWs (MKV GTI and GLI). They were the first "real" cars I ever owned and were fantastic during the length of my ownership. I was aware of the poor reliability of the MkIII/MkIVs before them, but I decided to take a chance - both cars were purchased CPO'd and this was back in the day when VW (smartly) offered a 4 year/50,000mi bumper-to-bumper warranty, so I felt comfortable with the risk. As it turned out, I never needed it; both cars ran and functioned like a Casio G-Shock (GTI - 90k mi, GLI - 60k mi) never leaving me stranded or going to the dealership for an unscheduled stop. My experience with both of these cars made me a VW fan. That said, as a lifetime St. Louis Cardinals fan, I finally know what it's like to be a Cubs fan. Being a VW fan is painful. You're burdened with the fact that despite the high standard of engineering they put into their cars, they can't seem to get it right. Ever. Especially in the US. Seriously, to me, VW ranks as one of the worst ran companies in general, let alone the automotive industry. VWoA in particular is hopeless. I'm not sure if it's from general incompetence or from the fact that it wields absolutely no power whatsoever in making choices for it's own market, but the outcome is the same: a catastrophic waste of potential. When you consider that Mazda - a company that completely lacks the supply-chain clout and economy-of-scale that VW takes for granted - can produce an entire line-up of modern, attractive, affordable, reliable and efficient vehicles and VW somehow can't, it really highlights how utterly clueless VW is. When VW announced a few years back their intention to reach 800,000 sales a year by 2018, I was skeptical. That said, I wanted to see how they planned to get there. That's a huge number - surely |now| VW would find a way to bring the Polo, Scirocco, Amorak, etc to the US market in the hopes of reaching their lofty goal, right? Nope. Like clockwork, they did none of those things. Instead of broadening their appeal to new customers with new vehicles in different segments, they alienated current ones and sent them packing to other carmakers by cheapening their core products and undid decades worth of brand identity. With the near-luxury market showing great profitability (just reference the A3, CLA, 2 series, upmarket pricing strategies for Mazda, etc) while other segments flounder, it's a fact that people will always spend money on more expensive things when they perceive that there's a value to do so. Thus, I don't think for a second that VW's problems are price related like so many other commenters believe. People will pay a high price for high value (see Apple). Instead of cheapening the brand, VW should've focused on fixing current problems - reliability, the associated perception of that poor reliability and the dealer network
      Not
      • 10 Months Ago
      Yeah they have expensive SUV lineup. Imagine a near $45k SUV (Touareg) that does NOT come with: Leather, Navigation, Rearview camera, adjustable headrests, manual lumbar seat adjustment..... Even the +50k Sport trim TDI does not have those features...
        adam1keith1980
        • 10 Months Ago
        @Not
        It is still cheaper than the Audi Q7, Porsche Cayenne, and upcoming Bentley SUV - and all of them share the same platform. This is the problem with VW - they sell Bentleys are a discount, and people just don't care; instead, they want a Toyota with a Lexus badge.
          Indubitably
          • 10 Months Ago
          @adam1keith1980
          Your completely missing the point... You can get a loaded explorer for less or just about the same price.
      Jim Pease
      • 10 Months Ago
      ". . . we only understand the US to a certain degree . . ." Really?
      Michael Carvey
      • 10 Months Ago
      The biggest issue Volkswagen has had in America is they have put outsiders in charge for the last 4 years. Stefan Jacoby came from Mitsubishi, although he did previously work for Volkswagen in Sales and Marketing. And they did not listen to him. So they replaced him with Jonathan Browning, from GM of Europe. Again, they did not fully trust him or listen to him. The one of the few guys they did listen to was Mark Barnes, Exec VP of Sales and Marketing (plus, interim President before Browning came on board), actually quit shortly after Browning came on board. Now, they put Michael Horn, a 15 year VW insider, in charge, and Mark Barnes returned once Browning was fired. Chairman Piech said in the story they do not fully understand the US market. So, now VW has two guys: one who knows the insiders of VW Europe (who ultimately sign off on any major decision), and one who knows the US market, to make decisions to benefit the company. Plus, although China is now the biggest auto market in the world (and VW's investment in China has shown that), they know they cannot be number 1 in worldwide sales (their ultimate goal) without seriously involving the US market. You will see major changes from VW of America in the next 2-3 years that align more with what Americans want from their cars.
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