Volkswagen AG is increasing its diesel sales in North America even as its overall sales fall in the United States.
Despite the growth of hybrids, Volkswagen is staying with its strategy of pushing diesels as fuel-efficient vehicles, said Volker Steinwascher, head of Region North America for Volkswagen AG, in an interview.
Volkswagen believes diesels will continue to grow in North America. For 2004, VW projects a 12 percent to 15 percent growth in diesel sales over 2003.
"We have been selling TDIs in the U.S. for almost 10 years, and we have firmly established Volkswagen as the leader in high-tech, clean-diesel engine development," Steinwascher said.
He pegs rising fuel prices as the main driver of diesel sales in the United States. "Sales are dependent, more or less, on the price differential between gas and diesel," Steinwascher said. "The more gas prices go up, the more interest there is for the customer to buy a diesel."
Last June, at a time when gasoline prices had reached about $2 a gallon, Volkswagen's diesel sales were up 46 percent over June 2003.
Volkswagen is by far the largest seller of diesel passenger cars in a market with few diesel offerings. The company sells diesel versions of its Jetta, Golf and New Beetle models. The German automaker also has introduced the V-10 TDI Touareg and the 2.0 TDI Passat.
The other diesel offerings in the United States are the Mercedes-Benz E320 CDI and a diesel-powered Liberty just introduced by Jeep.