Volkswagen Group of America Weathers Industry Storm; Emerges with Increased Market Share

-- Company grows market share by more than 20 percent in down market and continues construction on $1 billion Tennessee plant --

Jan 11, 2010, 20:30 ET from Volkswagen Group of America, Inc.

HERNDON, Va., Jan. 11 /PRNewswire/ -- Volkswagen Group of America, Inc. enters the new year with solid positioning following a series of 2009 successes.  The company has set a goal of selling one million Volkswagens and Audis by 2018, as part of the worldwide Volkswagen Group's focus on becoming an economic and environmental leader in the global automotive industry.  

"The entire industry was hit hard during the economic crisis.  Rather than scale back our investment here, Volkswagen Group has only ramped up our efforts in the U.S. market, which is critical to the company's global goals," said Stefan Jacoby, President and CEO for Volkswagen Group of America.  "We are now seeing the fruits of that labor with increased market share and improved sales."

Audi

For Audi, 2009 was indeed fruitful; the brand achieved solid sales despite the economic headwinds that prevailed for most of the year.  Audi closed 2009 with what is expected to be the largest U.S. market share gain of any imported luxury car brand.  Audi also achieved landmark December sales that represented a 17 percent increase above year-earlier December sales.  

A key component of the Audi U.S. market share success was strong customer demand for the Audi Q5 crossover vehicle, one of the fastest selling vehicles in the U.S. since its February 2009 debut. Due to strong demand for the Q5 and several other models, the Audi incentive spend for the year ranked among the lowest in the luxury car sector – a sign of the brand's surging popularity. Another key indicator of the progress that Audi made in 2009 came from ALG, which placed Audi third for luxury brand residual values.

Audi enjoyed a strong launch of its TDI clean diesel technology with a campaign that accentuated the fuel efficiency and greenhouse gas benefits that TDI offers as an immediate solution to concerns about energy and emissions.  The TDI technology is what earned Audi the prestigious Green Car of the Year® recognition.  Audi took the 2010 award at this year's Los Angeles Auto Show with its sporty A3 TDI.  It was the second consecutive win for the Group with the VW Jetta TDI claiming the 2009 title.  The Green Car of the Year® award is the industry measure of environmental innovation.  In earning the award, Audi proves that green and performance luxury needn't be mutually exclusive.

Fuel-stretching clean diesel TDI technology proved to be a winner among consumers as well.  TDI models accounted for 43 percent of Q7 and 53 percent of A3 sales in 2009, well above initial expectations of 18-20 percent. The Audi A3 TDI also claimed Car of the Year honors from the Detroit News. And the Audi Q7 TDI was named Truck of the Year in the Earth, Wind & Power competition.

Audi dealers voiced their support of the brand by committing over $1 billion worth of investment.  During the past four years 50 exclusive dealerships have opened, which represents nearly 80 percent of Audi's U.S. sales. There are now 130 exclusive Audi dealerships – a 30 percent increase from just three years ago.  And Audi dealer outlook scores measured by the National Automobile Dealers Association continue to climb.

Audi has its sights set on significant sales stories heading into 2010, led by the arrival of the all-new A8 luxury performance sedan, which enjoyed a worldwide debut in Miami in late November.  

Volkswagen

The Volkswagen brand launched some of the year's most sought after cars: the sleek four door coupe, the CC; sporty GTI; and the all-new Golf, which was named 2009 World Car of the Year.  The winning lineup and clean diesel TDI offerings helped the brand gain market share and close December 2009 with sales 16 percent over December 2008.  

"Our fuel-efficient TDI models now represent 20 percent of our total vehicles sales.  This has been a true competitive advantage for us," Jacoby added.

In addition to the environmental nods, the company earned high marks in safety and value.  Four 2010 Volkswagen models – the Golf four-door, Passat sedan, Tiguan, and brand-leading Jetta sedan –received the Insurance Institute for Highway Safety's (IIHS) Top Safety Pick award for 2010.  The Top Safety Pick is the highest rating possible from the non-profit research organization.

On the consumer side, five Volkswagens received top ratings in Strategic Vision's 2009 Total Value Index™ (TVI). Volkswagen's Jetta and Passat tied for first place in the medium car category, the Jetta SportWagen took the top spot in the medium multi-function group, the Tiguan was first among small SUVs, and the CC not only topped the larger car segment, but also received the highest TVI score of any vehicle in the running for this year.  The 2010 GTI was named Automobile Magazine "Automobile of the Year" and one of Car and Driver Magazine's "Ten Best."

"Volkswagen marches into 2010 on a solid foundation that we will continue to build on as we grow in the United States," said Jacoby.  

Construction continues at Volkswagen's LEED-aggressive manufacturing plant in Chattanooga, Tenn. In less than 300 business days, production on an American-specific midsized sedan will begin at the plant.  The plant is a $1 billion investment that will create 2,000 direct jobs.  According to studies, the Chattanooga plant is expected to generate $12 billion in income growth and an additional 9,500 jobs over the life of the project.  More than $600 million dollars in local contracts have been awarded to date.  

Volkswagen Group of America

Volkswagen Group is also investing in flagship Audi and Volkswagen dealerships in New York City.  The $125 million deal is for a 265,000 square-foot building in the high traffic area of 11th Avenue in Manhattan.

The company further asserted its investment in education.  Last year, Volkswagen Group announced a $5.28 million commitment to education in Tennessee which follows a $2.7 million commitment to Virginia schools announced in 2008.  Volkswagen Group strengthened its relationship with California universities with last year's dedication of the Volkswagen Automotive Innovation Lab (VAIL) on the Stanford University campus.  The Volkswagen Group has donated $5.75 million to the creation of VAIL, including $2 million for building construction and another $750,000 a year for five years to fund research and teaching activities.  

"Our educational partnerships are a critical component in our work in the U.S.," said Jacoby.  "These relationships bring fresh ideas and innovation, which is reflected in our products."

About Volkswagen Group of America, Inc.

Volkswagen Group of America, Inc. is a wholly-owned subsidiary of Volkswagen AG, the world's third largest automaker and the largest carmaker in Europe. It houses the U.S. operations of a worldwide family of distinguished and exciting brands including Audi, Bentley, Bugatti, Lamborghini and Volkswagen, as well as VW Credit, Inc. Founded in 1955, the company's headquarters are in Herndon, Va.

Volkswagen Group of America brings to the U.S. vehicles that marry the science of engineering and the art of styling, with the goal of offering attractive, safe, and environmentally sound automobiles that are competitive and set world standards in their respective classes.

The company has approximately 2,500 employees in the United States and sells its vehicles through an 800-strong dealer network. With increasing popularity for its brands in the U.S., the company has set the goal of reaching one million car sales in the country by 2018.

For more information, visit www.volkswagengroupamerica.com.

SOURCE Volkswagen Group of America, Inc.



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