GENEVA -- Volkswagen is shifting up to 30 percent of its U.S. marketing budget from the national to the regional level to boost sales and support dealers, says Volkswagen Group of America CEO Stefan Jacoby.
Jacoby declined to say how many dollars are being redirected. He says most of the funds will go to dealer advertising associations.
We really have to put everything into realizing sales right now. Its about focusing and setting priorities in our marketing money, Jacoby told Automotive News at the Geneva auto show yesterday.
Supporting its more than 600 U.S. dealers is one of several VW short-term objectives, Jacoby says. Other goals are maintaining the brands 2 percent U.S. market share achieved in early 2008 and reducing dealer inventory.
VW has a little more than a 100-day supply of vehicles on U.S. dealer lots. VW wants to return to about a 90-day supply by the end of the second quarter, Jacoby says.
We are very much aware that we need to support our dealer network. We cannot lose a significant amount of dealers during this time of crisis, he says. We want to grow. We have a long-term perspective and long-term plans, and that means we have to support our dealers and strengthen our dealer network.
VW has said it plans to more than triple U.S. sales to 800,000 vehicles over the next decade, from 223,128 in 2008. To reach those volumes, VW is building a $1 billion factory in Chattanooga, Tenn., that will produce a new mid-sized sedan beginning in 2011.
U.S. sales of the VW brand totaled 13,660 in February, down 17.5 percent from a year earlier while the overall market fell 41.3 percent. VW launched five new or redesigned models late in 2008: the Jetta TDI sedan and Sportwagen, CC sedan, Tiguan crossover and Routan minivan.