VW aims at family crossover market with CrossBlue concept
Photo credit: VW
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DETROIT -- Volkswagen AG's VW brand -- signaling its intentions to target another high-volume U.S. segment -- introduced a three-row crossover concept today at the Detroit auto show.
With six seats and a slight family resemblance to the Q7 sold by VW's sister brand Audi, the CrossBlue concept underscores the German automaker's determination to sell more vehicles in the United States.
VW, which aspires to sell 800,000 light vehicles in the United States by 2018, lacks a family-sized crossover.
"The CrossBlue concept is exactly the right type of vehicle for the U.S. market," Jonathan Browning, CEO of Volkswagen Group of America, said in a statement today.
VW's only six- or seven-seat offering is the Routan, a repackaged version of the Chrysler Town & Country minivan that has been relegated to fleet-only status for 2013 and may not be built after this year.
VW has found a niche for the largest SUV in its lineup, the plush five-seat Touareg, but the cost of the decade-old model -- it starts at $44,300, including shipping -- has limited its sales volume.
Sales of VW's compact crossover, the Tiguan, rose 22 percent in 2012, but that imported model was 14th in the segment with 31,731 U.S. sales.
U.S. dealers have clamored for a seven-seat crossover or SUV for years to compete with models such as the Honda Pilot, Ford Explorer and Toyota Highlander.
Those calls have intensified as crossovers have solidified their lead over minivans and station wagons as the top choice for many families.
Void in the lineup
"We see that as a void in the VW lineup," said Jimmy Ellis, vice president of Jim Ellis Automotive Dealerships in Atlanta and chairman of a council that lets VW dealers give feedback to the factory, during a recent interview. "That's where VW has to go if they want to get to the 800,000 units that they have forecasted by 2018. And they realize that, too."
With its diesel plug-in hybrid powertrain, the version of the CrossBlue unveiled today in Detroit seems unlikely to become a volume seller.
But it gives the first hint of what VW would do with a seven-seat crossover, allowing VW to compete in four of the five largest market segments in the United States -- all but large pickups, executives say.
"Hardly any segment in the U.S. is as important and dynamic as the midsize SUV segment," VW AG CEO Martin Winterkorn told reporters during a press conference Sunday in Detroit. "So the Volkswagen family must take initiative in this area too."
Autoweek, a sister publication of Automotive News, reported the crossover is expected to join the VW lineup for the 2015 model year, with a price around $32,000.
Speaking to reporters before the model's unveiling, VW sales chief Christian Klingler said the company will gauge the reaction from the auto show before committing to market the crossover.
He said it would not arrive this year, which suggests a debut for the 2015 model year at the earliest.
The mid-sized SUV would likely be built in North America for close proximity to the American market, Klingler said.
One likely site is the company's Chattanooga, Tenn., assembly plant, which VW opened in 2011 to anchor its U.S. operations and build the Passat. Autoweek reported that VW is expected to build the crossover and the Passat in Chattanooga.
The plant would give VW a steady supply of vehicles for the American market, and cushion against any currency shocks.
VW would likely follow the Passat formula when launching the vehicle.
That version of the Passat was larger than its predecessor to cater to American tastes. VW also cut the base price of the Passat by $7,180 to a more competitive $20,765 when it introduced the U.S.-built 2012 model, and sales jumped to nearly 117,023 in the first full year of sales.
Speaking to reporters before the unveiling, Browning said the crossover could help solidify the VW brand in the United States.
The automaker sold 438,133 VW brand vehicles in 2012, up 35 percent.
"There are different routes by which you could get to our 2018 goal, but it's important that the VW brand is considered part of the mainstream business in the United States," he said.
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