VW pins US hopes on expanded crossovers and SUV line-up

MICHIGAN: The world’s biggest carmaker is still a bit player in the United States, but Volkswagen AG’s (VW) hoping an expanding line-up of the crossovers and sport utility vehicles (SUVs) Americans love to buy will help propel its brand into the mainstream.

“We have a plan to become successful here in the United States in the next years as a relevant volume player,” said VW global head Herbert Diess.

“We can’t win America over in two years’ time. It’s a 10-year plan, but we are committed."

The carmaker which now sells three sport utility vehicles in the US, plans to introduce a fourth utility model by 2020, said Hinrich Woebcken, VW America’s chief executive officer.

That’s part of its plan to ramp up to 19 total SUV or crossover models worldwide by that same year, said Diess.

The plan to grow its US share of the SUV segment comes as VW ramps up output of its newest large vehicle, the Atlas.

VW’s factory in Chattanooga is producing 400 Atlas SUVs a day, and still has more capacity to fill, said Antonio Pinto, head of the plant. Still, US Atlas sales slipped in July to 1,306 amid a summer holiday break after reaching 2,413 in June, its second month on the market. The model, with a name chosen in consultation with US dealers, is a key piece as VW looks to meet the needs of US consumers with growing families.

VW aims to be a “relevant player. Right now we are a niche player,” said Woebcken, adding that the brand is committed to launching two new or redesigned models a year in the US.

VW has opportunities to tap into growing demand for SUVs around the world, not just the US. Last week in Italy, Diess presented the T-Roc crossover, which is sized to compete in the fastgrowing subcompact segment that includes the Nissan Rogue Sport, Toyota C-HR and Honda HR-V. The Tiguan was lengthened for the 2018 model year and comes with a standard third row in front-wheel drive versions. Diess said on Thursday VW is still deciding whether the T-Roc will come to the US market.

VW is targeting 40 per cent of its worldwide sales to be SUVs by 2020, up from less than 15 per cent now, said Diess.

The company is also planning to produce some electric models in the US, though it’s too soon to say when, he said.

The Tennessee plant making the Atlas, which also assembles Passat sedans, has added about 900 workers over the last year, bringing total employment to about 3,200, said Scott Wilson, a factory spokesman. It’s also almost doubled the number of robots to 850, he said.

Output of the SUV started in December. The factory produces about 45 total vehicles an hour, up from 35 when it was only making the Passat, after expanding the floorplan by 26 per cent to accommodate Atlas production. Bloomberg