Can VW Sell 1500 Cars A Day? – 24/7 Wall St.

Posted: Sunday, August 30, 2015

VW has struggled mightily in the U.S. with a share of barely 2% of the cars and light trucks sold through the first seven months of the year. As the world’s largest car manufacturer, the number has to weigh on management, and its ability to crack the second largest car market in the world. Volkswagen of America, Inc sold 205,742 cars through July, and is on track to reach 350,000 this year. If it can get that figure closer to 500,000 over the next two years, it can consider its efforts a modest success. That is 1,500 cars a day, which does not seem like much.

VW has won enough awards particularly for its Golf line of models, that one would think this would translate into sales. The 2015 Golf was the Motor Trend 2015 Car of the Year. It was rated a “Top Safety Pick” based on a recent evaluation from the IIHS. (Although a great many cars tested get this level of accolade) One model of the Golf–the SE (1.8 T)–did particularly well in a “Consumer Reports” test. On a less positive note, the VW brand barely rated above average in the new ACSI evaluation of major car brands.

While the reason remains hard to figure, VW cannot catch rivals like Subaru and Kia. One of the reasons most car industry experts believe VW cannot make progress in the U.S. is its limited line of models. The only model which sells well is the Golf, which posted a sales increase of 169% through July to 37,441. Without the base Golf’s sales and its GTI version, the Golf “family” would not have an improvement at all. The Jetta Sedan has at least held its own with sales flat at 76,045 through the first seven months. Sales of Passat, one of VW’s best-selling models, have collapsed 16% to 49,099. Sales of the iconic Beetle have fallen 17% to 15,400.  One lesson from these numbers is that the introduction of new models into the U.S. market would help. It is a wonder the world’s largest car company has not been able to do that, even if the effort might be expensive .

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The math is simple. Volkswagen of America, Inc need to sell 1,500 cars a day, as soon as possible. It would mean a great deal, at the very least symbolically, if VW could break the half a million a year sales barrier.  Enough to say, VW would no longer be spiraling down in the U.S.

 

 

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