VW Executive Says Company Will Double US Sales within 3 Years

By Brendan Moore

01.11.2010

VW logoStefan Jacoby, head of US sales for Volkswagen, told reporters at an event in Washington, D.C that VW intends to double its American sales by 2013 at the latest.

VW’s 2009 projection was tossed into the rubbish bin when the global recession hit, but Jacoby says the company is feeling better about the future at the moment.

“We are a little bit more optimistic now than we were a few months ago,” the executive said, noting that the basic economic indicators in the US are starting to trend upward.

VW sold 213,454 vehicles in the US in 2009, a drop of 4% from 2008. That is actually a good performance compared to most other brands, but certainly not what VW had in mind for the year’s numbers. If the 2013 projection comes to fruition, VW would sell somewhere between 400,000 and 450,000 in that time frame. Jacoby stated that if that goal is achieved, the company’s US operations would probably be profitable.

And if you think that goal is optimistic, VW’s plan for US sales in 2018 is 800,000 units. VW says it will get there as a result of more dealerships in more regions of the US, and greatly increased local production. The company is currently building out a large production facility in Chattanooga, Tennessee.

Jacoby said VW expects overall US sales to rise to 15 million units annually in the next couple of years, and then plateau, although VW’s plan assumes greater growth in the compact and medium-size sedan segments than the rest of the market. This, of course, is Volkswagen’s sweet spot.

Still, it’s a big jump from where the company is now. It’s also quite possible that the company could reach the three-year volume goal and still not be making a profit, despite selling all of those vehicles.

Only time will tell, and the planets are going to have to line up right for VW in the next 36 months, but its possible. The question is how probable it is.

COPYRIGHT Autosavant – All Rights Reserved

Author: Brendan Moore

Brendan Moore is a Principal Consultant with Cedar Point Consulting , a management consulting practice based in the Washington, DC area. He also manages Autosavant Consulting, a separate practice within Cedar Point Consulting. where he advises businesses connected to the auto industry. Cedar Point Consulting can be found at http://www.cedarpointconsulting.com.

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7 Comments

  1. So they’re thinking big, is that so bad? They could easily do it with new models, the cars made in the States, more dealers, and the Detroit 3’s continuing decline. Some company is going to fill the vacuum, why not VW?

    Everyone’s always ready to scoff at anything ambitious these days!

  2. Why VW though of all companies? When will people realize that these goddamn cars cost an arm and leg to service, even more when the warranty expires. This is my biggest fear and issue anything VW (and EUROPEAN) related. Then again, if you’re lease prone or swapping cars every other year, it probably doesn’t matter anyway. Pay to play I suppose but the cost of admission is too much for me.

  3. Excellent point about them hitting their volume goals and still not making a profit. That could easily happen with VW in the US market because the dollar-euro FX isn’t working, and their costs on the cars made in Europe have always been high.

    VW could win the battle of volume and lose the war of profits.

  4. Concerning the euro/dollar debate: I think the reason for VW building the plant in Chattanooga is that they can hold the sticker cost down better with cars made in America than with those made in Europe. VWs are great cars, and I wish them success.

  5. Last I heard, VW loses money on every Golf sold to an American customer, and has for years, no matter what the exchange rate was for the euro in that time. I wonder what cars will be made in Chattanooga.

  6. @Beat-Nick

    I do remember that was the reason the MKVI was released after only a few years in production due to high costs. Supposedly, they slashed quite a number of things both in the car itself and across the assembly line process. Reviews also tended to say that the MKVI is an even better car than before so go figure.

    I’m of the opinion that they’d likely shift Jetta production to Chattanooga from the current Hecho in Mexico plant. We just can’t get enough of them Jettas apparently.

  7. Shift Jetta production to TN and then make the Golf in Mexico, so it’s cheaper to make than the ones made in Europe? Maybe.

    My question is, if they can’t make money on the Golf made in Europe, how will they make money on the Polo when they start selling it in North America?

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