With Rising Sales and Two Crossovers on the Way, Volkswagen of America Can Probably Breathe Easy
The diesel emissions scandal that continues swirling around Volkswagen’s German workforce is merely a far-off cloud for the folks at Volkswagen of America. Sunny skies reign, thanks to a decision to go heavy into “Americanized” crossovers.
Sure, the Jetta and Golf families continued their downward trajectory, joined in the descent by VW’s Passat sedan, but those lost sales are more than made up for by two nameplates: Tiguan and Atlas. Break out the iced tea.
Year over year, August’s U.S. sales tally of 32,225 vehicles was a 0.7 percent increase over the same month last year. Over the first eight months of 2018, VW’s U.S. sales rose 7 percent, carried aloft by the strength of the considerably larger, new-for-2018 Tiguan, its older, soon-to-be discontinued Tiguan Limited sibling, and the midsize Atlas.
Insulated from tariff threats, the Chattanooga-built Atlas saw its year-over-year sales grow 44.4 percent in August. Year-to-date volume is pointless, as the model only appeared in May of 2017. Sales of the second-generation Tiguan, which boasts lots of extra space between its axles, grew 189.4 percent. Its predecessor (and brief stablemate) accounted for 1,276 sales — a 27 percent year-over-year increase.
In the automaker’s car segments, there’s plenty of opportunity for doom and gloom. Sales of the Golf family, which encompasses the Golf, GTI, Golf R, and Golf SportWagen, sank 39.7 percent in August, year over year. Over the first eight months of the year, Golf family sales declined 37.7 percent. The Jetta sedan, now all-new, declined by 14.6 percent, year over year, with YTD volume down 36.1 percent. Still, the just-launched newness of the 2019 model means August was the Jetta’s best month so far this year — this factor, as well as the fact that VW slowed production at the beginning of the year, accounts for some of 2018’s lack of Jetta enthusiasm.
Elsewhere in the lineup, endangered Beetle sales — which are hardly a large slice of VW’s product pie — rose 14.3 percent in August, with YTD volume down just 2.2 percent. The car has its niche, I suppose. The U.S.-built Passat, of which some buyers need to be reminded of its existence, saw sales fall 32.2 percent. Since the start of the year, Passat sales declined 34.3 percent.
Total up these lost passenger car sales, and it amounts to a significant number. And no one expects the “cars are yucky” trend to reverse itself anytime soon. However, there’s a solution for that, and it comes in the form of two crossovers: a sportier, two-row version of the Atlas, heralded by this year’s Atlas Cross Sport concep t, as well as a small crossover designed, at least initially, for the American market. The first of the two new models enters production in Chattanooga next year, while the second, built in Mexico, arrives in 2020.
There’s also a chance the Atlas-based Tanoak pickup truck might have a future in America, but the powers that be are making damn sure there’s a business case for it before pulling the trigger.
Whatever VW loses on the car side of things, it seems there’s a higher-margin vehicle with a raised ride height to compensate for it.
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What I got from the article was VW was essentially turning into Acura in the US- two SUV models that sell, and the rest of the lineup looking for a purpose to be on the showroom.
I bought an Atlas SEL-Premium 4Motion for my wife a week ago. Her Yukon XL went belly up at 118,000 miles (transmission) and I wanted her to downsize a tad. It's an interesting car in top line trim. The VR6 is a smooth engine. I was really surprised. It reaches out and tickles at some Audi amenities but with random reminders that you opted for VW instead, such as some hard plastic bits in places that you'd expect a soft touch. But infotainment and the digital dash are great. Second row space feels just as big or bigger than the big Yuk' and third row space isn't bad, either. Fuel economy isn't terrible but the fuel tank is slightly smaller than a Honda Pilot's or Toyota Highlander's with slightly worse mpg so fill-ups are fairly frequent. I also agree w/ the Jeep comments. From the side, it looks like a swollen Grand Cherokee.