Volkswagen Group of America

Last updated

Volkswagen Group of America, Inc.
TypeSubsidiary of Volkswagen AG
Industry Automotive
Founded Englewood Cliffs, New Jersey (1955)
Headquarters Herndon, Virginia, United States
Number of locations
20 "Operational Facilities" in the US
Area served
North America
Key people
Scott Keogh CEO
ProductsAutomobiles, Automotive parts
ServicesAutomotive financial services
Owner Volkswagen Group
Divisions Volkswagen of America,
Audi of America, LLC,
Bentley Motors Inc.,
Bugatti of America,
Automobili Lamborghini America LLC,
VW Credit, Inc.
Volkswagen Credit Canada
Electrify America
Website www.volkswagengroupofamerica.com

Volkswagen Group of America, Inc. (sometimes referred to as Volkswagen of America, abbreviated to VWoA), [1] is the North American operational headquarters, and subsidiary of the Volkswagen Group of automobile companies of Germany. VWoA is responsible for five marques: Audi, Bentley, Bugatti, Lamborghini, and Volkswagen cars. [2] It also controls VW Credit, Inc. (or VCI), Volkswagen's financial services and credit operations. [3] The company is headquartered in unincorporated Fairfax County, Virginia, near Herndon. [4] [5]

Contents

In Germany, the parent company Volkswagen AG is responsible for eight marques of the group, from six European countries: Volkswagen, Audi, Bentley, Bugatti, Lamborghini, Porsche, SEAT, Škoda and Volkswagen Commercial Vehicles.

As of March 2008, VWoA has 20 operational facilities, spanning coast to coast, and its primary objective is "to offer attractive, safe and environmentally sound vehicles which are competitive on an increasingly tough market and which set world standards in their respective classes". [6]

On July 16, 2008, Volkswagen AG announced plans to build its first production facility in the United States [7] since the closure of its Westmoreland Assembly Plant in 1988. The Volkswagen Chattanooga Assembly Plant was inaugurated on May 24, 2011, and currently builds the US-spec Volkswagen Passat and in 2017 started production of the Volkswagen Atlas. [8]

History

Foundation

Formed in October 1955 in Englewood Cliffs, New Jersey, to standardize dealership service in the United States, it grew to 909 Volkswagen dealers in the US by 1965 under the leadership of Dr. Carl Hahn. Under him and his successor as president of Volkswagen of America, J. Stuart Perkins, VW's U.S. sales grew to 569,696 cars in 1970, an all-time peak, when Volkswagen captured 7 percent of the U.S. car market and had over a thousand American dealerships. The Volkswagen Beetle was the company's best seller in the United States by a wide margin.

From then on, however, intense competition from American and Japanese automakers caused VW sales in America to fall as much as 87 percent between 1970 and 1992, despite the introduction of new front-drive models in 1975 to replace the Beetle and its rear-engined, air-cooled stablemates. As a result, the number of dealerships in the U.S. was also reduced to 630 by the mid-1990s. As of 2007, there were 596 operating Volkswagen dealerships in the country.

Westmoreland and Auburn Hills

VWoA inaugurated the Volkswagen Westmoreland Assembly Plant near New Stanton, Pennsylvania, in 1978. This was the first modern venture by a foreign automaker at making cars in the United States. In 1988, the plant was closed. In the early 1980s, the manufacturing division and the sales division were merged, and Volkswagen of America moved to Troy, Michigan, as a result, settling in Auburn Hills, Michigan, in 1991 ( 42°38′43.2″N83°12′55.4″W / 42.645333°N 83.215389°W / 42.645333; -83.215389 (VWoA former HQ at Auburn Hills) ).

1990s uncertainties

Volkswagen of America's sales hit rock bottom in 1993, with fewer than 50,000 cars sold that year. Sales began to recover the following year with the introduction of the third generation of the Golf and Jetta. By the end of the decade, thanks to effective advertising and the launch of more competitive new products, including the New Beetle in 1998, the VW brand was back on firmer ground. Volkswagen of America went on to sell 355,648 cars in 2001, its best year since 1973.

2000s

In the 2000s sales tapered off somewhat due to competition, quality issues and delays in product introductions, and VW's U.S. sales for 2005 totaled 224,195 – a reduction of about 37 percent from four years earlier. New models for the 2006 and 2007 model years, such as the Passat, Rabbit, and GTI resulted in a sales growth of 4.9% for 2006 with sales of 235,140 vehicles. Profitability still remained an issue, though; Volkswagen of America had not turned a profit for its parent company since 2002. In January 2007, Volkswagen of America president Adrian Hallmark publicly stated[ citation needed ] that he planned to get the subsidiary back to profitability in two to three years. He hoped to introduce new models for North America, and develop new marketing to encompass the whole brand as well as individual cars.[ citation needed ] Stefan Jacoby soon replaced him, and Volkswagen of America continued to look at new products to add to its lineup.[ citation needed ]

In the meantime, a new advertising agency, Crispin Porter + Bogusky, helped rejuvenate VW's presence in the U.S. as well. Its ads for the fifth-generation GTI have sparked interest in the brand, not seen since the launch of the New Beetle, and ads for the fifth-generation Golf/Rabbit hatchback translated into initial strong sales for that model. Due to new air pollution rules promulgated by the United States Environmental Protection Agency (USEPA), the diesel powered VWs with TDI-PD technology could no longer be produced after December 31, 2006. For the 2009 model year, VW introduced a new generation of diesels, based on common rail technology. These would meet air pollution standards in all 50 states. The first of these units was made available for sale in August 2008. VW sold 2050 Jetta Sedan TDIs and 361 Jetta Sportwagen TDIs that first month.[ citation needed ] Volkswagen was later charged with three felonies and fined $25 billion for defrauding the American government when it was discovered that their vehicles were only passing laboratory emissions testing due to company tampering of their system's internal software.

In October 2009, Interpublic Group's Deutsch, Los Angeles, the ad agency of renowned ad man Donny Deutsch, won Volkswagen's American advertising account - fourteen years after Deutsch had tried for VW's advertising business against Arnold Advertising. [9]

New headquarters in Virginia

On September 6, 2007, Volkswagen of America announced it would relocate its North American headquarters to Herndon, Virginia. [10] [11] Volkswagen sales are particularly strong in the Mid-Atlantic region, as well as both coasts. The company indicated that it is important for them to locate in a region where their customer base is strongest. Presently, the Big Three domestic brands dominate the Midwest US, especially Metro Detroit where the company was formerly located.

Volkswagen of America began its move from Auburn Hills to Herndon in April 2008. The company anticipated that 600 of the 1,400 staff would remain at Auburn Hills in the call center and technical services positions, while 400 jobs would transferred to Virginia. About 150 employees in Michigan were expected to move to Herndon, Volkswagen of America President and CEO Stefan Jacoby said. The four hundred remaining jobs were to be cut.

The state of Virginia, among 14 locations that Volkswagen of America considered for the move, offered Volkswagen $6 million in incentives that will be awarded pending Volkswagen's fulfillment of employment and other various quotas.[ citation needed ]

New manufacturing plant

On July 15, 2008, after an intense, months-long battle between Huntsville, Alabama, a site in Michigan and Chattanooga, Tennessee, the company's supervisory board chose Chattanooga as the location for the new plant. [12] This $1 billion investment was expected to result in production of about 150,000 cars a year by its slated opening in 2011, playing a major role in the company's strategy to gain more than 6% of the car market, or about 800,000 cars on top of the 230,000 it produced in America in 2007, by 2018. [7] [13] This plant also became Volkswagen Group of America's manufacturing headquarters in the U.S.. [13] The plant was inaugurated on May 24, 2011. [14] [15]

Current US facilities

As of March 2018, Volkswagen Group of America has the following 20 "Operational Facilities" across the US: [6]

Regional offices

Brands

Volkswagen

Current models

The following is a list of the models currently available in the American market:

SedanCompact
Arteon · Jetta Sedan · Passat Sedan Golf
SUVWagon
Tiguan · Atlas · Taos · ID.4
PerformanceConvertible
Golf GTI · Jetta GLI

Sales

The total number of new vehicle sales year-by-year in the U.S. market is as follows:

Calendar YearTotal American sales
1970569,696 [16]
1997137,885 [17]
1998219,679 [18]
1999315,563 [19]
2000 [20] 355,479
2001355,648
2002 [21] 338,125
2003302,686
2004 [22] 256,111
2005 [23] 224,195
2006235,140
2007 [24] 230,572
2008 [25] 223,128
2009 [26] 213,454
2010 [27] 256,830
2011 [28] 324,402
2012 [29] 438,133
2013 [30] 407,704
2014 [31] 366,970
2015349,440
2016322,948
2017 [32] 339,676
2018 [33] 354,064
2019363,322 [34]
2020325,784 [35]

Audi

Current Audi models

The following is a list of the Audi models currently available in the American market:

Audi Sport models

The following is a list of Audi Sport currently available in the American market:

Sales

Calendar YearTotal American sales
1995 [36] 18,124
1996 [36] 27,379
1997 [37] 34,160
1998 [38] 47,517
1999 [39] 65,959
2000 [40] 80,372
2001 [41] 83,283
200285,726
2003 [42] 86,421
200477,917
2005 [43] 83,066
2006 [44] 90,116
2007 [45] 93,506
2008 [46] 87,760
2009 [46] 82,716
2010101,629
2011 [47] 117,570
2012 [48] 139,310
2013 [49] 158,061
2014 [30] 182,011
2015202,202
2016210,213
2017 [50] 226,511
2018 [51] 223,323

Bentley

Current models

The following is a list of the models currently available in the American market:

Lamborghini

Current models

The following is a list of the models currently available in the American market:

Bugatti

The only vehicle sold new under the Bugatti label is the Chiron.

See also

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