EGN NEWS DESK
Probably solely Americans of a sure age keep in mind when the Volkswagen Beetle was the best-selling imported automobile within the United States and the hippest experience to a Grateful Dead live performance was a Volkswagen Microbus.
Volkswagen is making an attempt to faucet a few of that nostalgia in its newest push to regain the standing and gross sales it loved within the United States through the Beetle’s and Microbus’s heydays within the Nineteen Sixties. But this time it hopes its prime fashions will probably be electrical.
The German carmaker is second solely to Toyota globally however is a distinct segment participant within the United States. Part of its plan to revive its fortunes right here is to lean on a brand new electrical mannequin that resembles the Microbus, the ID.Buzz, and to revive the Scout model with a line of electrical pickups and sport utility automobiles.
Last week, as big earth movers kicked up clouds of mud, Volkswagen executives and native officers gathered close to Columbia, S.C., to inaugurate the location of a manufacturing facility that may construct automobiles bearing the Scout badge for the primary time since 1980.
Volkswagen is one among a number of international automakers that see electrical automobiles and the upheaval they’re inflicting as a method to problem the dominant gamers within the United States. Volkswagen, which additionally owns Audi, Porsche, Bentley and Lamborghini, is aiming to no less than double its market share within the United States by the top of the last decade from a meager 4 % now.
“This market is popping electrical, and everyone’s ranging from scratch,” Arno Antlitz, the chief monetary officer of Volkswagen, mentioned in an interview. “This is our distinctive alternative to develop.”
Electric automobiles have already shaken the trade rankings, emboldening Volkswagen and different international automakers. Battery-powered S.U.V.s and sedans helped Hyundai Motor and its sister model Kia overtake Stellantis, the maker of Jeep, Dodge, Chrysler and Ram, because the fourth-largest carmaker by gross sales within the United States final yr.
“Electric automobiles are serving to our model to be seen as a know-how chief,” mentioned José Muñoz, chief working officer of Hyundai. They additionally entice a better-educated, extra prosperous buyer than has been the case for the South Korean firm’s gasoline automobiles, he mentioned in an interview.
The checklist of corporations that dominate electrical automobile gross sales appears lots completely different from the highest rankings for general U.S. gross sales, hinting at a future when a distinct group of corporations rule.
The prime 5 corporations within the United States for all engine varieties are General Motors, Toyota, Ford Motor, Hyundai and Stellantis. In electrical automobiles, Tesla is No. 1 by a large margin, adopted by Hyundai, G.M., Ford and Volkswagen. Toyota is a minor participant in electrical automobiles.
“Just since you’ve been round for 120 years doesn’t imply you’re going to have something on this new market,” mentioned Steven Center, the chief working officer of Kia America.
Volvo Cars is one other firm hoping to make the most of the adjustments wrought by electrical automobiles. The Swedish carmaker, which is majority owned by Geely Holding Group of China, reported a 26 % improve in U.S. gross sales final yr.
Much of that development got here from hybrids which have a gasoline engine and might journey shorter distances on batteries. But Mike Cottone, president of Volvo Car for the United States and Canada, mentioned he noticed hybrids as a pathway to completely electrical automobiles.
Later this yr, Volvo will start promoting a Chinese-made, all-electric compact S.U.V., the EX30, which can begin at $35,000. The firm can even start delivering the EX90, a seven-seat S.U.V. that’s made in South Carolina and can begin round $80,000.
Especially for luxurious automobile patrons, Mr. Cottone mentioned, “there’s a number of room for development within the E.V. section over the subsequent few years.”
Volkswagen has tried and failed because the Seventies to turn out to be a much bigger presence within the United States, and analysts are skeptical that this time will probably be completely different. “I’ve seen Volkswagen set these objectives earlier than,” mentioned Michelle Krebs, govt analyst at Cox Automotive.
The established carmakers won’t be pushovers. G.M. and Ford are additionally investing closely in electrical automobiles, whereas Toyota has mentioned it’ll begin producing a big electrical S.U.V. in Kentucky subsequent yr.
Ms. Krebs identified that auto gross sales within the U.S. have been rising slowly, making the combat for market share largely a zero-sum sport. “There’s this little little bit of development that everyone goes after,” she mentioned.
Volkswagen’s final massive push within the United States led to scandal. In the early 2000s, the corporate tried to promote Americans on automobiles with “clear diesel” engines. It marketed the gas, which was utilized in European passenger automobiles far more than in American automobiles, as extra environmentally pleasant than gasoline.
But the marketing campaign collapsed in 2015 when U.S. regulators found that Volkswagen had used software program within the automobiles to cheat on emissions assessments. In actuality, the automobiles polluted as a lot as long-haul vans.
The scandal had one profit for Volkswagen. It prompted the corporate to speculate early in electrical car know-how and construct automobiles that have been designed from the bottom as much as run on batteries, quite than make awkward modifications to gasoline fashions. In Europe, Volkswagen’s varied electrical manufacturers collectively outsell Tesla, in line with Schmidt Automotive Research.
The individual accountable for doubling Volkswagen gross sales within the United States is Pablo Di Si, president of Volkswagen Group of America. Mr. Di Si, initially from Argentina, mentioned he deliberate to make use of the identical technique he deployed whereas overseeing the corporate’s operations in Brazil, the place Volkswagen’s market share rose to greater than 16 % from 9 %.
“You have a look at the segments that you simply assume are going to achieve success 10 years from now,” Mr. Di Si mentioned in an interview. “What are your gaps within the product portfolio? And then you definitely begin including merchandise for these explicit markets.”
In the United States, he mentioned, that’s prone to embody gasoline automobiles and hybrids in addition to all-electric automobiles. Volkswagen plans to import the ID.7, an electrical sedan, and the ID.Buzz. Mr. Di Si hinted that there may additionally be a brand new electrical car that references the design of the Beetle. The final model of that automobile bought within the United States was the 2019 Beetle.
Volkswagen is constructing a $5 billion manufacturing facility in Ontario to provide batteries to its factories in Chattanooga, Tenn., and Puebla, Mexico, which collectively will produce no less than 80 % of the corporate’s automobiles bought in North America. That will assist patrons of automobiles from its Volkswagen, Audi and different manufacturers qualify for federal tax credit of as much as $7,500 per automobile.
Scout will fill a significant hole in Volkswagen’s portfolio: pickups, among the many hottest automobiles within the United States. By reviving Scout, which was one of many first passenger automobiles that would navigate tough dust tracks in addition to metropolis streets, Volkswagen hopes to draw patrons who usually purchase off-road-capable automobiles from U.S. manufacturers like Chevrolet, Ford and Jeep.
The South Carolina manufacturing facility will underscore the made-in-America vibe when the primary Scouts go on sale in late 2026. Volkswagen inherited the Scout model when the corporate’s truck subsidiary, Traton, acquired Navistar, a U.S. firm beforehand generally known as International Harvester, in 2021.
The new Scouts might borrow some components utilized in different Volkswagen automobiles, firm executives mentioned, however the design will probably be distinct from current automobiles like the electrical ID.4 S.U.V. made in Chattanooga. Scout plans to disclose prototypes this yr.
A stronger presence within the United States is “a strategic necessity,” Scott Keogh, the chief govt of Volkswagen’s Scout Motors division, mentioned in South Carolina final week.
Outside the United States, Volkswagen is a behemoth, with a 26 % share of the European market and 15 % in China. But the corporate is beneath extreme stress in China, the place gross sales of electrical automobiles have been rising quick, permitting BYD and different Chinese carmakers to realize market share from international automakers. Volkswagen wants development within the United States to compensate.
Volkswagen “desires to have a robust world footprint,” Mr. Keogh mentioned, “not have an remoted footprint, the place it’s solely sitting robust in a single area.”
