Back To The Roots: Volkswagen Plans Budget Brand
Volkswagen wants to go back to its “People’s Car” roots, and plans to launch a new low-cost brand by about 2015, Reuters says. With a a price range of between 5,000 and 10,000 euros ($6,500-$12,900), Volkswagen wants to emulate the success of Renault’s Dacia. Nissan resurrected Datsun as a low-cost brand to help gain market share in lucrative emerging markets.
Volkswagen’s low cost cars would target the BRICs, but may also be sold in Europe, sources told Reuters.
According to Manager Magazin, Volkswagen is planning a budget sedan, wagon, and mini-van. It will lack pricey gadgets such as head airbags and air conditioners. Older engines and older, amortized platforms would be used.
By the time Volkswagen comes out with its low cost contenders, Renault/Nissan may already have hit a new lower price point. There have been ongoing rumors of Renault working on a car that in the €2,500 ($3,250) area. The most interesting engineering feat: Renault/Nissan can make decent money on a car that goes for petty cash.
Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.
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I don't see why Skoda isn't the ideal solution. They could have thier current model line and budget cars in emerging markets. Ford is considering a budget subcampact in addition to its Fiesta. Its also not uncommon to have subbrands within a marquis; such as the Prius family that are Toyotas, or even Corvette and Mustang are sub brands. Bottom line, VW does not need a 13th brand
I'd think if VW wanted to downgrade any of their brands it'd be SEAT before Skoda. Granted they've both had a lot of money invested in turning them into a sport (SEAT) and value (Skoda) line, but the former's a slower seller and does have a history of building old FIATs while Skoda - despite it's history on the wrong side of the iron curtain - designed and built their own material, and raced it.
VW has already to some level been doing this. A bit like the comparisons of the new Datsun with the Mexican Nissan Tsuru, the new VW cheap brand could start with for example the VW Citi Golf.
Does this mean the Up! will need to be re-branded?