Can Volkswagen EVER Salvage Their US Efforts?

Volkswagen's experience in the U.S. has always been one of highs and lows. But rarely have its fortunes sunk so low as now. Less than a decade ago, the quirky reinvented Beetle helped VW come roaring back from a previous crisis. But for the past three years, its U.S. operations have lost close to $1 billion annually.

Now it's trying again to save the brand in the U.S. To head U.S. operations, it's bringing in Stefan Jacoby, a German with close ties to VW Chairman Martin Winterkorn and Supervisory Board Chairman Ferdinand K. Piëch, who took control of the company this year after a shakeup that left Porsche as VW's controlling shareholder. Jacoby, 49, an accountant by training, made his mark as head of VW's global sales and marketing. Since Jacoby took charge, the company boosted its European market share to 20.3% from 18.1%, helping keep it solidly in place as the Continent's leading brand. With its U.S. fortunes in long-term decline, Jacoby is facing his biggest challenge yet. His mission: to meet Winterkorn's target of breaking even in the U.S. by 2009.


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Kinger - 7/18/2007 12:31:33 PM

+1 Boost

The new golf and passat seem to have improved things quality wise. With Porsche watching over their shoulder i'm sure thay can create cars which are practical but also fun too. The latest Golf GTI is a definite return to form in terms of driving dynamics over the previous model.

daytonaviolet - 7/18/2007 2:39:32 PM

0 Boost

VW has a lot going for it in terms of style, fun to drive, etc. But their reliability reputation will take a long time to get back.

In that price range I would much rather drive a VW than a Honda or Toyota, but my last VW was so problematic I'll never own another one without a warranty.

GTR35 - 7/18/2007 2:54:46 PM

0 Boost

Is that VW new logo? They did a good job to "reassemble the brand's finery"

abqhudson - 7/18/2007 3:09:29 PM

+3 Boost

After all of the parts problems (parts not available) and warranty and service problems, I gave up on my 2006 Rabbit - sold it. Drove great - build quality terrible and cheap materials. More funny noises (from buzzes to ticks to whines to rattles) than I ever experienced in a car - will make me very hesitant to buy anything associated with VAG.

YMMV.

Jim

Htay7500 - 7/18/2007 3:27:53 PM

+1 Boost

their jetta needs a facelift, the back looks like the dated corolla. though we can only consider one if they can fix their electrical and better yet, quality problems and issues. but, their parts arent cheap and neither is maintenence. theyre great cars, but like our passat, they arent as solid for a daily driver like our hondas, nor does it fit our budget. if ppl are looking for a good reliable family sedan under $20k bery urgently, (and there are lots of ppl who have this budget) they would have to go with the hyundai, honda or camry. the sonata is 15-16k, camry is 16k, accord is 19k and the passat starts at 22k. thts how much an 07 honda accord se is! again, they have to look at what theyre dealing with.

Larry - 7/18/2007 3:44:01 PM

-1 Boost

No, VW is finished. Did you VW is making a Mercedes SL type of car from the phateon platform. I can not believe how much effort VW puts into cars with so little market share, maybe some of these Audi/ VW fans from autospies can take their 100k and buy a VW pheoton SL ..

Htay7500 - 7/18/2007 4:10:23 PM

0 Boost

explain urself, since when did VW did "better than ever"? in NA?

paul3230 - 7/18/2007 7:52:07 PM

+2 Boost

I'm sorry but did you even bother to READ the article? They are losing a billion dollars a year!! How are they doing "better than ever?"

mini22 - 7/18/2007 4:12:05 PM

+5 Boost

They do have a quality perception problem. Obviously the cars built in Puebla Mexico are still not made that well. Perhaps building a plant in the US like Westmorland PA is the way to go. They should have kept that plant. Also they need the "Micro Bus" concept,the VW Sirroco or a updated Kharman Gia. They need to simply buy a Civic,Accord,and a Corolla and Camry,study those cars with a fine tooth comb to see how they are built and why they sell well.Perhaps by doing this they will finally "get it".

Htay7500 - 7/18/2007 4:14:05 PM

+1 Boost

dunno, VW said the sirroco would hurt sales of the GTi,

dwatson - 7/18/2007 10:58:35 PM

+1 Boost

I agree with Mini22. It's been my experience that Volkswagen's are very cheaply assembled. They have attractive interiors but they use the same cheap hard plastic as all the other car companies. That's really embarassing for a European marque. I'd also like to point out that the new Jetta is horribly unattractive (let's be honest). The new Passat and Toureag are very attractive and luxurious but VW is failing to maintain it's image as being a "quirky" car company. Now they just make normal cars.

david989 - 7/18/2007 8:42:48 PM

+1 Boost

VW is finished. Next.

M316 - 7/18/2007 10:29:26 PM

+1 Boost

Europeans are well known as badge snobs so dont expect them to rush to buy asian cars. That being said the japanse have been making great inroads recently. But generally they buy vauxhalls/opels, vw's, peugeots and lowend (316,318) BMW's and Benz's.

ThierryHenry14 - 7/18/2007 11:40:01 PM

0 Boost

Changing their Jetta was a major problem. The old Jetta was so much better looking than the current ones.

I think thats the big difference. If VW can make a Jetta as timeless and popular as the last generation one, it would be profitable once more.

EnnNorak - 7/19/2007 9:28:54 AM

+1 Boost

VW should adopt the Quattro AWD system for all its models as standard equipment and I mean the true Quattro with the Torsen center differential and not some el cheapo system as found on the A3 and some VW models. The Audi A6 needs a proper 60-degree V6 instead of an inherently-out-of-balance 90-degree V6. Having said that, I can tell you from personal experience with my current leased A6 that Audi is leading VW's charge toward recognition as the undisputed king of affordable luxury and technical excellence.

EnnNorak - 7/19/2007 11:28:15 PM

+1 Boost

Are you saying that VW does not own Audi? I really don't give a damn if the VW group has set up entirely separate management structures for the various elements of the group. I agree that for VW to abandon the North American market would be utterly stupid. The VW group already shares some platforms so I see no impediment to eliminating the 90-degree V6 engine configuration from all models and adopting the more sophisticated Audi AWD system across the board.