By on July 6, 2012

Volkswagen wants to be the world’s biggest, most profitable, most innovative, and most loved automaker by 2018, and everybody at Volkswagen has been sworn-in to do their share. US managers promised that they will deliver a million sales a year to the group. It’s a tall order.  To get there, “American consumers will need to buy a lot more new Volkswagens, Audis and Porsches,” Reuters says.

June ’12 June ’11 Change YTD ’12 YTD ’11 Change
Volkswagen Grp 51,057 38,673 32% 274,960 210,877 30%
Porsche 3,002 2,546 18% 16,450 15,542 6%
Total 54,059 41,219 31% 291,410 226,419 29%

U.S. Volkswagen Group sales in the first six months of this year, with 16,450 Porsches already factored-in, are less than 300,000, below 600,000 for the full year if all goes well.  However, they reached an important historical milestone. Coincidentally, sales of a resurgent Volkswagen will be around Volkswagen’s high water mark of 1970, when it sold 569,696 cars, mostly Beetles.

To reach its one million unit goal by 2018, the Volkswagen Group would need an uninterrupted annual increase of 10 percent. That’s doable, again, if all goes well.

Currently, Volkswagen runs at an annual increase of 30 percent, but that’s coming from a low base.  As the table shows, finally acquired Porsche does not move the needle much, it provides moral support at best.

According to Reuters, much of Volkswagen’s recent success

“is attributed to the overhaul of the Jetta and the Passat, both of which were specifically tailored to better suit mainstream U.S. consumers and re-engineered to be built at a much lower cost than their predecessors. The compact Jetta is assembled at VW’s sprawling Puebla factory in Mexico, while the mid-size Passat is the first car to roll off the line at the new $1 billion Chattanooga, Tennessee, plant that opened last year.”

To get to a million units, Volkswagen needs a lot. It needs more models, more and better dealers. It needs to get out of the perennial J.D. Power doghouse, and, related, it needs to address the fact that any mention of Volkswagen triggers an avalanche of “VW sucks” comments on the webs. As we will hear instantly.

 

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33 Comments on “Volkswagen Back At 1970 Glory, But Will It Be Enough For 2018?...”


  • avatar
    The Doctor

    “the fact that any mention of Volkswagen triggers an avalanche of “VW sucks” comments on the webs”

    Just like any British marque provokes ‘Lucas: Prince of Darkness’ comments. Did Pavlov ever talk about how to de-condition his dogs?

    • 0 avatar
      Joe McKinney

      Or Fix It Again Tony remarks whenever someone mentions Fiat.

      This all just goes to show that once a car company gets a bad name it is very hard to overcome. Along the same vein we could ask the Detroit three how they are doing with that “perception gap”.

  • avatar
    kvndoom

    Well, does VW suck??? Do they truly have a higher number of repairs done than other makes, or are the owners just more vocal?

    • 0 avatar
      LeeK

      Suck? No. But they are lagging the competition in regards to initial quality (JD Powers) and reliability (Consumer Reports). While VW’s overall reliability has been improving steadily since the disastrous early 2000s (Mk IV Jetta/Golf/New Beetle/Passat/Toureg), the rest of the competition has also improved their quality levels, so Volkswagen remains in the bottom tier.

      As we know, it will take years and years and years to change the consumer perception of quality. My wife has owned three VWs in the past six years and two of them (GTIs) have been close to flawless. An R32 however, turned out to be a lemon and we dumped it. VW needs to figure out how to smooth out the curve.

    • 0 avatar

      Does VW suck? Good question. To me they do but it hasn’t to do with reliability. To me they suck ’cause the styling is poor, the internal design is unimaginative, the ride is numbing and at least here in Brazil when you try to buy one of their cars the dealers act as if they’re doing you a favor.

      As to reliability, I think it’s the ‘perception thing’. In Brazil and Europe, if your Fiat or Renault (maybe like Big 3 in US) have a problem all hell breaks lose. But if your VW (maybe like Toyonda in US) gets something, people think that since the car is so good that maybe somehow they did something wrong.

      • 0 avatar
        kvndoom

        In this day and age, we can’t expect the volume sellers to be exciting at all. Everybody is copying Toyota, for better or worse. However, VW does build some “fun” models as well, such as the GTI, GLI, Turbo Bug, and R. Those should retain some personality.

      • 0 avatar
        30-mile fetch

        Marcos,
        Lousy dealers aside, you dislike VW for subjective reasons that will come down to personal preference. I like the conservative exterior styling, straightforward ergonomic interiors. I look at the contrived and overwrought Hyundai sheet metal and bizarre Honda dashboards and see nothing appealing. I think that VW ride and handling is a good balance between Toyota quiet & isolation and Honda’s noisy responsiveness.

    • 0 avatar

      Hey 30-mile fetch! It’s Marcelo, not Marcos!

      You are absolutely correct of course. My dislike for VW is subjective. I understand why some people like them and buy them, but I’ve never been tempted. Well, maybe a Fox, but a Gol a Jetta? For me, and I stress, for ME, they don’t cut it.

      I don’t like the design, I don’t like the inside, don’t like the ride.

      As to Hyundai and Honda, I agree 100%. Don’t like the business of the Hyundai. I think it tires quickly. And the Honda interior! What a mess. I think at least the new Civic looks better outside. But the inside is a turn off. Nope, don’t see a Hyundai, Honda or Toyota in my immediate future.

    • 0 avatar
      DeadWeight

      “Well, does VW suck??? ”

      That depends on what your definition of “suck” is.

      By my estimation, indeed they do.

  • avatar

    Hi Bertel! To reach their lofty goal what’s VW’s worldwide outlook? Ok, America double sales, Europe I think they expect to just get incremental gains, but how about the rest of the world? How much would they need to grow in Brazil, Russia, Asia?

    Aboout Asia, since the Suzuki tieup went sour, are they on the prowl to buy somebody else or do they intend to grow their own brand?

    Finally, are they really thinking of ressurecting DKW as their low cost brand (a la Datsun)? Have heard that crazy idea here from some guys I know.

  • avatar
    tmkreutzer

    Came here to say “Volkswagen sucks!”

    My 2002 TDI was an absolute lemon – blown head gasket at 20K miles, brakelight switch/auto transmission interlock failure, windows falling into the doors at odd times, leaky sunroof, soft touch plastics melting and getting sticky, yadda-yadda-yadda, all the way down to the stupid VW logos spinning off the center caps of my wheels on no less than three occasions – leaving an unsighly yellow blob of glue each time.

    I so wanted to love that little car. I forgave it and repaired it agian and again. One day, a single (but rather large) straw broke that camel’s back and I dumped it as a non running mess on craigslist. Let’s hope he had more luck with the car than I did.

    I’ll never own one again and will do my best to ensure that everyone within earshot will won’t either. Now all of you with similar experiences need to pile on because when the fan boys get here, I’m going to get shouted down…

    • 0 avatar
      Joe McKinney

      I had good luck with my two Jettas – a 2003 GLS and a 2006 TDI. Both were bought new and traded just shy of 100k miles. I never had any significant problems with either car, but knowing VW’s reputation and the associated repair costs, I didn’t want to keep them too long – especially the TDI with its complex DSG transmission. I now own a Honda.

      Here are the problems Volkswagen must address to maintain its momentum in the U.S.
      1. Purchase Price – addressed with the new Jetta and Passat.
      2. Build Quality – remains to be seen.
      3. Long-Term Reliability – remains to be seen
      4. High service and repair costs – I’ll bet they overlooked this one.

      • 0 avatar
        Luke42

        @Joe:
        Your wording gives you away. You had “good luck” with your VWs. I had fantastically “bad luck” with my VW, and so have many others.

        Once burned, twice shy. I really liked a lot about my 2001 Jetta TDI, but I can’t in good conscience fail to comment on a company that allowed that POS on the road AND failed to support it with affordable parts AND failed to support rebuilders AND failed to provide reengineered parts that fixed the problem.

        We need data, not luck. Volkswagen fails to understand in 2001 that the competition made.cars that would run for hundreds of thousands of miles with just scheduled maintenence. Do they get it now? I’d love to see some data that shows they’re as good for long-term ownership as Toyota. Or Ford. Or even GM.

        We need data that shows they a) recognize that they have a problem and b) have fixed the problem. And the product needs to reflect this at every level.

        I loved they way my TDI drove, and looked, and it had a wonderful balance of performance and efficiency. But it was unmaintainable on many levels – crawling under it, it was clear that it wasn’t designed the be serviced. Refurbished parts only lasted weeks, and secondary parts are a necessity for long-term ownership – especially when OEM parts are overpriced and not particularly reliable or easy to install. Basically, Volkswagen needs an AA type of approach to fixing their quality problem – including the lifelong struggle against relapse.

        My father drove and maintained Volkswagens. I drove and maintained a Volkswagen, threw up my hands, and pulled my old beater out of mothballs and drove it for another three years. Owning a Volkswagen must be like having an alcoholic uncle in the family… You want to love them, but it’s so hard….

      • 0 avatar
        Joe McKinney

        Volkswagens are definitely a hit or miss proposition. I happened to get two good ones.

      • 0 avatar
        30-mile fetch

        Luke42,
        Keep in mind that you had a pre-2005 Jetta, which seemed to be the poster child for god-awful VW reliability. After 2005 the Jetta/Golf improved greatly in reliability, and that is verifiable if you look at Consumer Reports and True Delta.

        The problem is that a good portion of their current or very recent lineup (previous Passat, Touareg, and to some extent GTI still pull low reliability ratings. You have to be careful what model you pick, and that is not appealing for many people.

      • 0 avatar
        tayu

        @luke42

        Replies like this are what make TTAC awesome. Coherently written, detailed and descriptive.

        Thanks for the comment

  • avatar
    Luke42

    I got very badly burned by a 2001 Jetta. Both by the reliability of the car, and by the availability of refurbished parts – particularly the ZF O1M 4-speed automatic transmissions. I

    liked the car enough that we went through about five of these transmissions (most of them provided by the rebuilder “free of charge”) before the mechanic forgot to tighten the bolts that held one of the lower ball joints to the subframe – and thebfront wheel fell off just after I got off of a 6-hour high speed night journey on the Interstate.

    Needless to say, I had the car repaired by a VW dealer shortly afterward. Any car for which I can’t get a rebuilt transmission in the USA is not a car I can own.

    So, Volkswagen, it’s been over a decade since y’all built that lovable but unmaintainable POS. What have you done for qualityband reliability lately? Will Volkswagen “man up” to their history of poor quality the way Dominoes Pizza did?

    There is a lot that I want to like about VW’s products, particularly the TDI series, but I can’t like a vehicle thatnis prohibitively expensive and dangerous to maintain.

  • avatar
    Manic

    Good old Euro vs. US image…
    In the UK J.D Power survey says VW has 8th place out of 27 brands.

    http://www.whatcar.com/car-news/jd-power-survey-2012/the-results/263078

    • 0 avatar
      DC Bruce

      subject to correction, I would explain this apparent disparity by a much lower penetration of Japanese cars into the European market and, from the evidence about all of them here in the U.S. — from Mercedes down to VW — European cars are generally of lower dependability than Japanese cars and, perhaps some American cars.

      In other words in Europe, VW is the sort-of “best of a bad bunch.”

      In the U.S. market, it is the penetration of Japanese imports which has spurred American manufacturers to step up their game with respect to quality, which they have done in only some cases (e.g. Ford Fusion, which has been consistently excellent).

  • avatar
    spyked

    I had four mk4s and two mk5, and now have a CC. One of the mk4s had bad coils (duh, every 1.8T did).

    My personal experience with all my various cars is that you take care of the car, it takes care of you.

    VW can strive to be the bestseller, thats fine, but surely someone there knows that only Americans accept inferior low-tech and cheap products. People in the rest of the world want nice stuff…if they dare to lower prices elsewhere by simplifying their offerings like they did here, they will fail miserably. I know the point of business is still sell the most and make the biggest profit, but they should just be content having the most dynamic line up of cars.

    • 0 avatar
      Robbie

      Yes, one wonders if VW will not kill off the one great selling point it has with the current cheapening.

    • 0 avatar
      30-mile fetch

      “Americans accept inferior low-tech and cheap products”

      The success of the mid-90s Camry and strong sales of the Accord and Civic throughout the 90s suggest otherwise. Those cars were neither cheap nor inferior and sold very well because of it. They’ve become cheap and unremarkable in the intervening 10-15 years and still sell well, so I don’t know what to say about that.

    • 0 avatar
      sfay3

      This comment reminds me of the endless posts in various forums around the net explaining how all cars (including Range Rovers and late-80s BMW 750iLs) are reliable “if you do the maintenance.” It’s like the BMW owners who tell us that replacing the entire cooling system is a “normal” part of “maintenance” ever 100,000 miles or so.

      • 0 avatar
        Ubermensch

        Just what I was going to say and it isn’t even remotely true. ZERO of the numerous problems with my VW had anything to do with maintenance items. For it to be true it would mean that people maintain VWs worse than they do almost all other makes. I doubt you would find that to be even remotely statistically true, in fact it is more likely to be the inverse. I maintained my VW above and beyond BTW. I understand the German car apologist mindset because I used to be one.

  • avatar
    lmike51b

    “…and re-engineered to be built at a much lower cost than their predecessors…” Sounds like they think if they build them cheaper, that will fix everything.

  • avatar
    jetcal1

    2002 GTI; Average drive time of 44.8 hours Mean Time Between Failures. VW bought it back because they couldn’t even troubleshoot the no-start failures.

  • avatar
    Robbie

    This news item here comes after just yesterday I had my car fixed at a VW dealership.

    Long story short: I tried to have that place maintain my car for three years, spent a fortune in the process, and was lucky my car didn’t have many problems; but after yesterday I will not go back there and will not buy a new car there.

  • avatar
    Oelmotor

    The poor quality from VW will not withstand the US daily driver requirements, unless you like visiting the service facility on the way to work.

    VW might have a chance if they could release “Auto Bild” to US consumers.

  • avatar
    30-mile fetch

    I’m a new VW customer, bought mine two years ago. Was immediately smitten with the way it drove, the driving position, and the interior. Improved reliability in the Jetta/Golf since the 2005 redesign convinced me to pull the trigger.

    The reliability of this car will solely determine whether I am a repeat customer who recommends the brand to others, or whether I come back here to bury VW under hate.

    The new Passat and Jetta seem to be good matches for the American market, but that will change in a big hurry if their repair record is worse than we can tolerate. I hope they have that sorted out.

  • avatar
    brettc

    I like VWs and have owned 6 VWs (5 diesel or TDI, one gas model) in the past 12 years. The gas Golf that we bought was a POS because it was neglected by the previous owner(s). Buying that thing was definitely a mistake, but it was a 1993 Golf that we paid $2200 for. All my diesel VWs have been pretty trouble free. The only real unexpected problem was the failure of the injection pump on my 2003 Jetta. But I got it rebuilt and drove the car for another 2 years before I sold it to a cop last year that was driving around in a giant F350 pickup (fuel costs were killing him).

    To succeed in the U.S., they need to offer a full model range including an Accent/Versa competitor, a pickup, and a van that isn’t made by Chrysler. Apparently the Routan contract with Chrysler is up in 2013 so hopefully they offer something decent for 2014. They also need to make them as reliable as possible. I think reliability has improved but of course that takes a long time to sink in if you built POSs 10 years ago and burned a lot of people.

    I’m considering buying a new Jetta TDI wagon next year (Sorry Steve Lang!) to replace my 2002 Golf TDI. I want something newer and need some more room for trips. Just need to get a nice down payment saved up first because I hate car payments.

    • 0 avatar
      Detroit-X

      What about all the expected problems? A notable choice of words there. Some of us expect no (i.e. very few) problems for a brand Vanting To Take Over Dah Vorld.

  • avatar
    Dynamic88

    My son leased a Jetta 3 years ago, on VW’s sign and drive plan. Nothing down, just start making your lease payment. There’s no cheaper way for a young man with his first grown-up job to get into a new car. In fact it’s cheaper than getting into most used cars.

    The Jetta has been trouble free for 3 years. My son will probably buy the car at the end of the lease.

    I doubt VW will ever most loved. Innovation doesn’t always translate into sales. Chasing volume is a fools game. Most profitable? We’ll see. My money is on the Koreans.

  • avatar
    TOTitan

    I bought a new Rabbit for my daughter in 08. The car now has 54,000 miles on it and has had no breakdowns or malfunctions at all. With that in mind bought a new 12 Jetta Sportwagon TDI a month ago. So far so good with it too.


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