Volkswagen AG, Europe's largest carmaker, aims to sell more than 100,000 units of a new version of its best-selling Jetta sedan in the U.S. a year, according to the interim chief of the VW brand in the country.
"The new Jetta will be a very nice volume product for us," Mark Barnes, who was appointed last month to run Volkswagen of America, said in a June 16 telephone interview. "The goal is to bring the masses to Volkswagen who currently believe they cannot afford a Volkswagen."
The new Jetta, VW's first model altered specifically for the U.S. market, is 3.5 inches longer than the European version. The model accounted for half the brand's 214,000 U.S. deliveries in 2009, excluding the Audi luxury brand, and 44 percent of the total in the first six months of this year.
Volkswagen cut the price for the extended Jetta, which goes on sale in October, to about $16,000 from the current base of $17,735. The reduction brings the model closer to the starting prices of Toyota Motor Corp.'s Corolla and Honda Motor Co.'s Civic, now at $15,450 and $15,455 respectively, according to company websites.
VW aims to sell 1 million cars and sport-utility vehicles in the U.S. by 2018, with its Audi luxury division accounting for 20 percent of that figure. The Wolfsburg, Germany-based manufacturer is aiming to dethrone Bayerische Motoren Werke AG as the largest luxury-car maker.
Chattanooga Plant
A new assembly plant in Chattanooga, Tennessee, will probably begin production in the third quarter of 2011, Barnes said in the interview. VW is using the factory to produce a sedan that is bigger than other VW cars for U.S. customers.
"We'll have the new product in late third quarter or early fourth quarter," Barnes said.
Asked whether there is room for a second model, Barnes said: "Certainly there's enough room down there to expand, but our focus is clearly on the new mid-sized sedan."
VW said June 24 that it was holding contract talks with U.S. chief Stefan Jacoby. At the same time, it named Michael Lohscheller, who had been in charge of finance in the U.S. since 2007, to run Volkswagen Group of America on an interim basis, while Barnes would do the same for the Volkswagen brand until Jacoby's contractual situation is clarified.
The negotiations focused on Jacoby's contractual obligations to the German carmaker before he takes over as CEO at Volvo Cars, people familiar with the matter said June 25.
Excluding Audi, VW aims to more than double U.S. deliveries to 450,000 by 2012 to 2013, Jacoby said in January.
Volkswagen's preferred shares added 18 cents, or 0.2 percent, to 76 euros in Frankfurt June 16, bringing their gains this year to 16 percent and valuing the carmaker at 34.1 billion euros ($44.1 billion).
