VW restates goal: Double U.S. sales by 2012

[NINETY EIGHT REGENCY]

VW restates goal: Double U.S. sales by 2012

Diana T. Kurylko

Automotive News -- February 22, 2010 - 12:01 am ET

ORLANDO -- Volkswagen Group of America reaffirmed its goal to sell 450,000 cars in the United States by 2012 at it meetings with dealers this month.

That's a big jump from 2009, when VW sold 213,454 vehicles. But VWoA management says new product introductions, including a redesigned Jetta and an all-new mid-sized sedan out of its new U.S. plant, will make that target achievable, said Wade Walker, president of Walker Motors Inc. in Montpelier, Vermont.

The mid-sized sedan goes into production in early 2011 and on sale a few months later.

"Those two cars will be the focus of the volume," Walker said.

VW's U.S. dealer meeting this fall will be at the factory in Chattanooga, Tennessee, where dealers will drive and see the car for the first time.

Dealers asked VW to strengthen marketing on some existing models, including the Passat-based CC sedan because of its growing popularity, Walker said. "We want to put the CC more into the public eye."

To boost sales of the slow-moving Routan minivan, dealers urged VW to launch more aggressive lease programs.

On the finance side, VW management said Volkswagen Financial Services is starting to ease lending to customers who don't have the highest credit ratings. "They'll buy deeper into a credit score, but it won't go back to the old times," Walker said.

VW won't hit the volume targets it has set without easing credit, Kevin Kelly, president of VW Financial Services, told dealers.

VW has set individual dealer targets to increase their sales so the company can meet its U.S. 2012 sales goal. Dealers were told that they won't have to meet new facility requirements or expand but that they were given the guidance "so they can do planning," said VW executives and dealers.

Stefan Jacoby, CEO of Volkswagen Group of America, said VW won't increase its dealership count significantly from the current 582. But dealers will have to add sales and service personnel and strengthen certified pre-owned car sales as the brand expands its range and volume, Jacoby said.

"They'll have to generate more used-car sales and get more experience with used-car sales and improve customer satisfaction," he said.

Mark Barnes, COO of VWoA, said dealers are concerned about the current low inventories. Supplies are low because of brisk sales at the end of 2009 and in January.

It will take VW until early spring to refill the pipeline, Barnes said. Supply is especially tight for the CC sedan and Tiguan crossover.

HIGHLIGHTS

• VW is easing lending requirements for consumers.

• Target is to sell 450,000 cars by 2012.

• "Punch Dub" campaign will expand.

Read more: http://www.autonews.com/article/20100222/COPY02/302239991/1317#ixzz0gHLpHUDW

[ZL-1]

Good luck. At least they're showing drive and ambition.

[Drew Dowdell]

Good luck with that when you've moved the Passat so far up market it's out of reach of most Camry, Altima, Malibu, Accord buyers.

[Robert Hall]

Good luck with that when you've moved the Passat so far up market it's out of reach of most Camry, Altima, Malibu, Accord buyers.

Aren't they replacing the Passat in NA with a new cheaper, larger Tennessee built midsize model in a couple years?

[Drew Dowdell]

They essentially want that new sedan to leapfrog all other intenders and come out of no where to sell 200k in a year. That's a little more than 50% of the Camry volume pre-brake fiasco.

They don't have the dealer body for it. They don't have the quality reputation for it. And Hyundai, Ford, and Chevrolet are gonna have something to say about it. Hyundai with the new Sonata, Ford with the momentum of the Fusion, and Chevy with the new Malibu due out right about the same time.

[regfootball]

exactly, to what Boi says.

where does VW get off thinking this? especially when they culture they promote is 'alternative'. you can't have your cake and eat it too. take volume, give up resale and your dedicated fan base. it will become watered down.

[pow]

exactly, to what Boi says.

where does VW get off thinking this? especially when they culture they promote is 'alternative'. you can't have your cake and eat it too. take volume, give up resale and your dedicated fan base. it will become watered down.

VW is very much "mainstream" in Europe yet it still retains a premium image over its slightly less expensive rivals, Ford and Opel.