The United States was supposed to be an important part of the Volkswagen Group becoming the world’s biggest automaker by 2018, with sales of 800,000 units in the U.S. by then, but it’s finding the U.S. market a tough nut to crack. “We understand Europe, we understand China and we understand Brazil,” VW Chairman Ferdinand Piech told Bloomberg this month. “But we only understand the United States to a certain degree so far.”
VW is currently being outspent on advertising in the U.S. by a two to one margin compared to its competitors and it has gaps in its lineup when it comes to appealing to American consumers. The volume VW and Audi brands both lost U.S. market share in October, according to analysts.
VW had doubled its U.S. sales, based on strong sales of the Passat, redesigned and contented specifically for the U.S. market but the Passat has stalled along with the rest of the lineup. Through the first 9 months of 2012, VW brand sales were down 3% in a market that, overall, grew 8%.
VW has spent $691 million on advertising for the U.S. market so far this year, less than half of that spent by GM, Ford or Toyota.
The German automaker has also been slow to the SUV and CUV party, two critical segments in North America. A U.S. style SUV based on the Crossblue concept will likely not make it to the market until 2016. Currently VW has nothing in between the compact Tiguan and the Touareg, which is more expensive than the Lexus RX.