Volkswagen 21st century cars

Volkswagen began introducing an array of newcompetitively pricing its Rabbit, with a base model
models after Bernd Pischetsrieder became CEO instarting below the average cost of a new
2002. The current Volkswagen Golf was launchedautomobile. Volkswagen's relations with its unions
in late 2004, came runner-up to the Fiat Panda inand its relationship with the government of the
the 2004 European Car of the Year, and has soGerman state of Lower Saxony, which owns
far spawned the new generation SEAT Toledo,stock in VW, remain impediments to further
Skoda Octavia and Audi A3 hatchback ranges asprogress. But under Wolfgang Bernhard, the
well as a new mini-MPV, the Seat Altea. TheVolkswagen Group executive in charge of the
fifth-generation Golf was introduced in Europe inVW brand, the company has recently been a
late 2003, and the GTI boasts a 2.0 Lgreater interest in the North American market
Turbocharged direct injection engine. Therather than treating it as an opportunistic
fifth-generation Golf, now with the Rabbit nameafterthought. As of October 2006, the strategy
once again, went on sale in the U.S. and Canada inseemed to be paying off, as VW's U.S. sales for
June 2006. (The GTI version arrived in Norththe first ten months of the year were up over
America four months earlier.) Volkswagen ofthe period from January to October 2005 by
America decided that returning to the Rabbitnearly 10 percent.
nameplate will help the Golf's sales in these twoVolkswagen has offered a number of its vehicles
countries. The fifth-generation Jetta, and thewith an advanced, light duty diesel engine known
performance version, the GLI, are also available inas the TDI (Turbo Direct Injection). Whilst
the United States and Canada. Theextremely popular in the European market, light
sixth-genretaion Passat and the fifth- generationduty diesels do not yet enjoy the same wide
Jetta both debuted in 2005, and VW was soonacceptance in the American marketplace, despite
looking to expand its lineup further by bring backincreased fuel economy and performance
the Scirocco by 2008.comparable to gasoline engines due to
In North America, VW faces unexpectedturbocharging. According to the U.S. Environmental
challenge to maintain its relevance. After risingProtection Agency, four of the ten most fuel
significantly between 1998 and 2001, though,efficient vehicles available for sale in the U.S. in
VW's North American sales began to fall sharply2004 were powered by Volkswagen diesel
leading to a 2005 loss of roughly $1 billion (U.S.) forengines. They were a three-way tie for 8th (TDI
its operations in the U.S. and Canada. The reliabilityBeetle, TDI Golf, TDI Jetta) and ninth, the TDI
of the company's cars appears to bear some ofJetta Wagon. Sales of light duty diesel engine
the responsibility for this situation. By 2005, itstechnology are increasing as gasoline prices rise.
models sat near the bottom of ConsumerProducts such as the Toyota Prius might have
Reports relaibility ratings, and J.D. Power andhighlighted the economy of non-gasoline engines,
Associates ranked VW 35th out of 37 bands in itsbut in reality, a Volkswagen TDI engine is often
initial quality survey. Attempts to enter a newfound to be more efficient than the Prius on the
market segment also compromised Volkswagen'shighway (although not so when driving in the city).
standing in North America. In 2002, VolkswagenIn addition, all VAG TDI diesel engines produced
announced the debut of its Phaeton ("Fay-ton")since 1996 can be driven on 100% biodiesel. For
luxury car, which was critically acclaimed but notthe 2007 model year, however, strict U.S.
well received in the marketplace. VW announcedgovernment emissions regulations have forced
its discontinuance in the U.S. market for the 2007VW to drop most diesels from their U.S. engine
model year, mainly due to the disappointing salesliuneup, but a new lineup of diesel engines
there and the need for major investments in thecompatible to U.S. standards are due for 2008.
car's line of engines (W12 and V8) to meet newVolkswagen long resisted adding an SUV to its
emission requirements. Also, Volkswagen haslineup, but it finally relented with the introduction
faced harsh criticism that the Phaeton had usedof the Touareg in the early 2000's. Though it
up money that was better invested in theirgained respectable reviews, the Touraeg has been
smaller cars.a modest seller at best. Some automotive
Volkswagen is still in a better position in Northanaylsts balme the Toureag's absence of a
American market than it was in the early nineties,third-row seat, a popular item even among SUV
when its U.S. sales plummeted to 49,533 units inbuyers who do not actually need a third-row seat.
1993. (By contrast, 224,195 cars were sold in theThe company remains committed to the SUV
U.S. in 2005.) The company hopes to remainmarket, though, and it plans to add a miniature
competitive in the U.S. and Canada with severalSUV, based on its "Concept A" concept vehicle,
new models. The fifth-generation GTI hassoon. On July 20, 2006, VW announced that the
generated interest among the VW faithful with itsnew vehicle would be called the Tiguan. One
"Make friends with your fast" and "Unpimp Mymajor irony of Volkswagen's current North
Ride" advertising campaigns. And although itsAmerican lineup is the absence of a minivan,
reliability remains to be determined, the GTI wasconsidering that VW is credited for inventing the
named by Consumer Reports as the top sportyminivan with its original Transporter, but the firm
car under $25,000. Even more encouraging wasis currently devloping just such a vehicle for the
Volkswagen's performance in the J.D. Power andU.S. and Canadian markets with DaimlerChrysler,
Associates 2006 Automotive Performance,with current plans to introduce it some time in
Execution and Layout (APEAL) Study. Volkswagen2008. The Touran microvan remains a possibility
scored highest among "nonluxury" brands, finishingfor the North American market should such a
fourteenth overall with strong performances byclass of passenger vans become lucrative on that
its new Jetta and Passat models.continent. So far that has not happened, although
Volkswagen has also added the Eos, a sportthe success of the Mazda5 is causing some
coupe with a convertible hardtop, to its U.S.automakers to consider introducing Euro-style
Canadian lineup as well. The Rabbit, GTI, are alsovans such as the Touran into the American
being made in Germany and the Eos in Portugalmarket.
for the North American market. These productionOne North American lineup change that may
points are used instead of producing in the VW'shappen is a new entry-level model for the North
Mexican factory in Puebla, where Golfs and JettasAmerican lineup below the Rabbit, the likes of
(1993 to 1998) were produced and also replacingwhich Volkswagen has not sold in the U.S. or
the Brazilian factory in Curitiba where Golfs andCanada since 1993. A venture with
GTIs were produced (1999 to 2006).DaimlerChrysler to produce such a vehicle was
The fifth-generation Golf, sold in North America asconsidered but dropped as of September 2006.
the Rabbit.North American Volkswagen fans continue to hold
Volkswagen is counting on better workmanshipout hope for the Polo, or at least a Polo-related
from its German plants to improve the reliabilityvehicle from Latin America, to be introduced here.
of its North American lineup, and it is also