Whoa! Is Volkswagen Stepping Away from Mass-Market Automobiles?
Insider Speculation Suggests a Move to Niche Models Like Hybrids, Phaeton
A report in Bloomberg Business suggests Volkswagen might get out of the business of selling entry-level cars in the United States. In a discussion in January between global chief Herbert Diess and the company’s U.S. dealers, Deiss suggested the company should stop trying to compete with Toyota in the mass market and instead focus on high-end models in the wake of its diesel scandal.
According to Bloomberg, the supposition was not taken well by dealer representatives. Alan Brown, chairman of the company’s U.S. dealer council, and 11 other dealers will lodge their concerns with Volkswagen AG’s executives next week, expressing their opposition to the idea.
Prior to the diesel emissions scandal, Volkswagen was slated to receive three new crossovers and was basking in the glow of its recently released, critically acclaimed Golf, which came in gas, diesel, and gas-electric hybrid models. Core values at the company centered on providing a quality German product at a reasonable price, bolstered by Volkswagen’s new, cheaper manufacturing facilities in Chattanooga, Tennessee. Dealers want the company to return to those ideals as soon as possible.
However, with the recent and surprising departure of Volkswagen of America CEO Michael Horn, the company’s future in this nation looks murky at best. According to Bloomberg, Horn was a key motivator behind the company’s push into the mass market, and his resignation could be a tacit confirmation his people’s-car ideals no longer mesh with the company’s goals.
Speaking to Bloomberg, Brown said dealers “have to take action.” He cited Volkswagen AG’s reputation slide from the EPA emissions scandal and concerns over future product planning, inferring that dealers may consider suing the company if it continues to go in its current direction.
Of course, this is all speculation at the moment, and Volkswagen still has a few tricks up its sleeve. The all-new Volkswagen Tiguan, due later this year, is still very much a mass-market automobile, and its green cred was bolstered by the GTE Active hybrid concept, a vehicle that might see the light of day within a year or so. Additionally, rumors suggest the company will devote a bespoke platform to a hybrid and full-electric vehicle known as the XL3, according to Auto Express. Such a vehicle would compete with the Toyota Prius and Chevrolet Volt, both considered “mass-market” entries.
So, will Volkswagen stay the course, or will it abandon the market that put it on the map in the 1950s with the Type 1 Beetle? Only time will tell, but those of us on staff who’ve become enamored with the brand’s budget-priced quality and cachet hope it’s the former.