By on September 1, 2017

2018 Volkswagen Atlas - Image: VolkswagenIn 2009, during the depths of a global financial crisis the likes of which generations had never seen, Volkswagen of America set forth on a nine-year plan that would more than triple sales to 800,000 units in 2018.

Stuff happened. A crisis (or two) got in the way. An overly Americanized product lineup lacking in utility vehicles underachieved. Volkswagen lost its right to sell diesel models in America. Volkswagen will struggle to sell 400,000 new vehicles in the United States in 2018.

Although at first it seemed possible — Volkswagen sales grew far faster than the market as a whole exiting the recession — the 800,000-unit sales goal has long since been abandoned. By 2014, before the diesel emissions scandal even broke, now-departed Volkswagen of America CEO Michael Horn was questioning the timing of the 800,000-sales goal.

As the summer of 2017 approaches a close, however, Volkswagen’s global boss Herbert Diess has a new, seemingly unrealistic goal for the brand’s U.S. operations, Bloomberg reports. With a stronger SUV lineup, Volkswagen wants to grow its U.S. market share to 5 percent in 2020.

Volkswagen’s market share in 2017? Less than 2 percent.

Interestingly, 5 percent market share in the United States equals somewhere between 750,000 and 900,000 sales, depending on the strength of the market. In 2015, for example, Jeep claimed 5 percent market share with 872,908 sales. Jeep then grabbed 5.3 percent of 2016’s market with 926,376 sales. Through 2017’s first seven months, roughly 500,000 sales would be required for 5 percent market share.

Volkswagen sold 188,329 vehicles during 2017’s first seven months.

Of course, we’ve yet to see the real impact of Volkswagen’s new SUV strategy. Gone is a utility vehicle lineup that included the undersized Tiguan and outlandishly priced Touareg. The Touareg is discontinued in the U.S. market after the 2017 model year.Volkswagen Brand Boss Herbert Diess 2016 - Image: VolkswagenThe first-gen Tiguan becomes the decontented, lower-priced, subcompact crossover-competing Tiguan Limited. In comes the all-new second-generation Tiguan with far more space and an available third row. That Tiguan serves as a follow-up to the properly large first-gen Atlas, Volkswagen’s first true competitor for the Ford Explorer and Toyota Highlander.

Yet on Volkswagen’s quest to add 2.5 times more market share over the next three years, the brand’s plan does not include the T-Roc — a true rival for the Honda HR-V, Buick Encore, and Jeep Renegade. While the U.S. market earns more than 40 percent of its sales from the SUV/crossover sector, Volkswagen currently produces only 14 percent of its U.S. sales from utility vehicles, a figure Herbert Diess expects to skyrocket in the next few years. Globally, Diess wants 40 percent of global Volkswagen sales to be SUV-derived.

There will be a new version of the Jetta, still Volkswagen’s best seller, next year. Volkswagen isn’t so foolish as to think the current-sized lineup will be sufficient to grow market share to 5 percent. But regardless of the size of the lineup, the number of SUVs, the affordability of cars, and the number of electric offerings, this level of growth would be a stunning achievement if actually accomplished.

Volkswagen has failed to do so in the past. It’s difficult to believe the company can do so now.

[Images: Volkswagen]

Timothy Cain is a contributing analyst at The Truth About Cars and Autofocus.ca and the founder and former editor of GoodCarBadCar.net. Follow on Twitter @timcaincars.

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26 Comments on “Forget Volkswagen’s ‘800,000 Sales by 2018’ Goal – VW’s New Goal Is 5 Percent U.S. Market Share by 2020...”


  • avatar

    Hilarious. They should take that act on the road.

  • avatar
    ash78

    “Globally, Diess wants 40 percent of global Volkswagen sales to be SUV-derived.”

    Project Name: Diess Nuts.

    Yeah, we’ll just call that a Battle of the Bulge reference. Keeping it highbrow.

  • avatar
    SCE to AUX

    Nobody believed the 800,000 sales by 2018 goal; it never seemed possible.

    This, too, is a bad joke, but even worse because the market is shrinking, and they want to increase market *share*.

    Increasing market share means you’re taking share from someone else. What mfr(s) will cede market share to VW?

    • 0 avatar
      ash78

      The other option is people driving Buicks die, while people age 16-20 need new cars (if they can be pried away from their cell phones and their mothers’ teats).

      So to your point, a strong focus on the Gen Z segment (where Scion abandoned) might help a bit. I doubt you’re wrestling repeat buyers away from Honda and Toyota.

    • 0 avatar
      qwerty shrdlu

      No one will intentionally cede market share, but FCA or even GM might screw up. Hey, it could happen.

  • avatar
    Pig_Iron

    I like to go for a walk at lunch around my industrial block where I get observe peoples daily drivers. Sometimes I like to note vehicles with the greatest longevity. One day I thought I’d see if there was any old/new Bugs. There was not only no Bugs, but no VWs of any kind. So I looked during my 1 hour commute home – none, not one.

  • avatar
    thelaine

    German car executives are really skinny and German politicians are really fat.

  • avatar
    Scoutdude

    Never going to happen. I expect their market share to decrease in the next few years as they inadvertently pulled a lot of demand forward with the diesel scandal. Not to mention all of the customers they alienated.

    • 0 avatar
      brettc

      That’s me! Have driven VWs since 1998, but I’m likely getting a C-Max next year after I turn in my TDI. I’d love a GTI, but I have a lead foot so it’s not a great idea… The wife’s next vehicle might be an Escape. She’s currently in a gas Jetta sedan.

  • avatar
    APaGttH

    If I was the head of VW North American sales and I was told that was my goal, I’d quit.

  • avatar
    Nostrathomas

    Every time I look at that Atlas I can’t help but think the defining goals of that project were to make it “big, dumb, and cheap”. Not sure it reflects that well on us North Americans, but it’s probably not a bad strategy if they want market share.

    Personally, I wouldn’t mind this Atlas so much, if at the same time they’d allow those of us who still appreciate a more European approach to be able to purchase a Passat wagon and/or Transporter. I’d be happy to add my volume of 1 with the right car.

    • 0 avatar
      dukeisduke

      The Atlas is as nondescript looking as the Kia Borrego. Kia sold just 10,000 Borregos when they pulled the plug. Let’s see if the Atlas can do any better.

      • 0 avatar
        28-Cars-Later

        VW Atlas > Kia Borrego, or the other way around I wonder?

      • 0 avatar
        whynot

        Corecction: Kia sold ~10,000 Borregos a year before they pulled the plug, not 10,000 total. The Atlas has sold 5,000 in three months (May-July), it should easily beat the 10,000 a year mark.

        Granted the Borrego’s issue was market timing, being released right when the economy crashed and fuel prices started climbing resulting in everyone running away from thirsty BoF SUVs.

      • 0 avatar
        darex

        Wow! It really does resemble the Borrego. I knew it reminded me of something.

  • avatar
    dukeisduke

    Stefan Jacoby was the guy that predicted 800,000 US sales per year by 2018. I thought he was nuts, even back in 2008.

  • avatar
    darex

    Announcing it will not be selling its latest vehicle, the T-Roc, in North America will NOT help in the furtherance of their goal. Oh, and … duh!!

  • avatar
    stingray65

    What percentage of the market would we get if we added all the 3-5 year projections from all the manufacturers? 150%, 200% of the market? When was the last time any CEO said “we hope to keep the share we have”, or “things are looking very challenging so we may lose some share in the years ahead”. Anyone that says that gets fired.

    • 0 avatar
      ash78

      For what it’s worth, I know some companies are not hyper-focused on market share, focusing more on profitability (eg Honda). But you can’t keep a big corporation that manufactures durable goods from focusing on it eventually.

  • avatar
    vehic1

    Yeah, 800k is probably high – but I’m sure they want to set an ambitious, not mediocre, goal for sales increases. August 2017 sales are up not only 9% from last year, but almost matched Aug. ’15 – before the diesel crisis began. They should hit around 340,000 sales this year, at this rate. And – VW sales in 2012 were the highest in almost 40 years – so they’re doing something right – whether commenters here who are fans of other brands like that or not.

  • avatar
    newenthusiast

    So one one hand, according to an earlier post here, VW wants to add more R-line trim vehicles to its lineup (http://www.thetruthaboutcars.com/2017/08/cranking-r-volkswagen-planning-product-assault-mercedes-amg-report-claims/).

    Now I read that they want to also increase volume.

    The former may be more profitable, but will not sell very much, as most R-line trim VWs would almost certainly be pushing into the territory of a similar Audi vehicle.

    If VW wants to grow volume, the really need to do two things:

    1) have a long term view of how to get there and where in the market they need to be positioned…..and stick with it.

    2) have at least one thing that differentiates them in he market. (I think offering this vision they seem to have of offering electric versions of all their vehicles could be an interesting development)

    In short, they need to be what they were…..which is what Subaru is now in North America. And Subaru moved into that space after VW gave it up, quite frankly. I’m not sure they will ever have much volume beyond that unless they go full on Toyota and Honda, which is run the N.A. division of the brand as almost a different company with the same name: different model lines, designs, engines, and sales and marketing channels mostly home grown here, not dictated top-down Germany.

  • avatar
    John Horner

    Even if VW somehow had the product mix to make that goal, it doesn’t have the brand strength. I turned 18 in 1979, and VW has largely done everything possible to destroy brand value throughout my adult lifetime. Spotty quality, botched Pennsylvania factory which was eventually closed in desperation, horrible customer service when problems happen, arrogant Germany Knows Best management, lackluster advertising lurching from one theme to another, the worst emissions cheating scandal to date, and so on.

    Meanwhile, Hyundai and Kia have come out of nowhere to build stronger US brands than VW has. This is absurd considering how special and respected the VW brand was in 1970. Once upon a time VW had the best advertising in all of the car biz and was on a roll. They never responded to the rise of the Japanese makers, the rise of the Korean makers and the modest recovery of GM and Ford.

    It blows my mind that VW can be so successful in other markets while almost always getting it wrong in the US.

  • avatar
    xflowgolf

    while they don’t have a mini-CUV directly, they have introduced the AWD Jetta (or Golf?) AllTrak which is basically a cheater way into the segment.

    Add plastic and slight lift to your wagon, ala Subaru, and pretend you have another CUV.


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