Volkswagen of America has appointed a new head of sales and marketing to replace Duncan Movassaghi, who left the company and returned to his native U.K.
Andrew Savvas, 44, a native of Australia who previously was director of Volkswagen UK, takes over this month as chief sales and marketing officer and executive vice president of sales and marketing for VW of America, the German automaker said Friday in a call with journalists about its 2021 sales results.
Savvas, who joined VW in Australia in 2012, had previously worked for Toyota Motor Corp. in his home country. While with VW Group, he was managing director for Audi in VW's Middle East region before spending the last two years in the U.K.
In other announcements on the call:
• The company had granted its more than 4,000 employees in Chattanooga a 10 percent wage increase this year. "In light of all the issues in employment, it's absolutely the right thing to do," VW Group of America CEO Scott Keogh said. "You want a satisfied workforce that's ambitious and motivated to work in the plant. This is a competitive labor environment everywhere across America, full stop. All industries know this, so you have to compete." The UAW tried unsuccessfully twice to organize the workforce at VW's plant in Chattanooga.
• VW will continue to import ID4s into the U.S. from Europe as it ramps up local production of the BEV compact crossover in Chattanooga this year, with locally produced versions beginning to appear in dealerships in the second half of the year, Keogh said. As expected, VW will offer a lower-priced version of the crossover with a smaller battery pack later this year that will start "in the $35,000 range," but otherwise expects to hold pricing in the current environment, he said.
• Keogh said VW's U.S. dealer network had an average return on sales of nearly 5 percent in 2021, about three times more money than they made the year before. "That is a very strong number, and frankly, some of the best numbers for VW brand franchises in U.S. history," Keogh said. Traditionally, VW dealer profitability has lagged far behind that of other franchises.
• VW sold 16,742 ID4s in the U.S. in 2021, its first year on the market, "but we could have sold four times that amount. What VW dealers are saying is that this is the most excitement they've had on the shop floor since 1998, when we brought the Beetle back," Keogh said. He predicted EV sales across the industry would begin to expand greatly, and could reach 10 percent of the total U.S. market "relatively soon." He said the ID4's range and capabilities will grow for the 2022 model year as the vehicle receives over-the-air updates.
• Microchip and other supply issues, including the weather, continue to disrupt production. He said Jetta sales (61,967 sales in 2021, down 25 percent) were sacrificed to continue to build crossovers, which represented a company high of 79 percent of sales in 2021, and that globally, VW is prioritizing production of EVs over internal-combustion models when allocating chip supplies.
• Keogh said he believes U.S. auto sales will continue to recover in 2022, and said he believes sales will reach 15.5 or 15.6 million this year, but that industrywide, there are at least three million pent-up sales from consumers who wanted to purchase a new vehicle but couldn't because of supply issues. That pent-up demand will keep prices and turn rates inflated this year, he said.