VW pricing opens slugfest against top-selling Camry

VW pricing opens slugfest against top-selling Camry

May 27th, 2011 by Mike Pare in Business Around the Region

Passats line a lot at the Volkswagen plant. Staff Photo by Angela Lewis/Chattanooga Times Free Press

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PASSAT MODELS


Engine, version and price

• 2.5L - S (manual): $19,995

• 2.5L - S (automatic): $22,690

• 2.5L - SE (manual): $23,725

• 2.5L - SE (automatic): $24,825

• 2.5L - SE with sunroof: $25,625

• 2.5L - SE with sunroof/navigation: $26,795

• 2.5L - SEL: $28,395

• TDI - SE: $25,995

• TDI - SEL Premium: $32,195

• 3.6L - SE with sunroof/navigation: $30,595

• 3.6L - SEL Premium: $32,950

Source: VW

Taking aim at Toyota's Camry sedan, Volkswagen on Wednesday unveiled pricing for its new Chattanooga-made Passat with the base model undercutting its segment-leading Japanese rival.

The base 2012 Passat's $19,995 price tag is less than the current 2011 Camry, the U.S. midsize sales leader, which starts at $20,195, according to Toyota's website. Camry's 2012 pricing isn't available yet.

The base Passat costs less than many of the midsize sedan front-runners, according to the automakers' prices. The fast-selling Hyundai Sonata begins at $19,395.

The Passat's clean diesel TDI version, which VW says can achieve 43 mpg on the highway, will start at $25,995, according to the manufacturer's suggested retail price.

The Passat's top-of-the-line, gasoline-powered offering will go for $32,950, the automaker said. A $770 destination charge will be added to all cars, which go on sale this fall.

The 2012 Passat will offer a variety of features and premium options in three powertrains, according to VW.

Still, VW has cut about $7,000 from the base price of the European-built Passat that the Chattanooga car is replacing in the U.S. in order to bolster sales, officials said.

Jonathan Browning, CEO of Volkswagen Group of America, said this week at the city plant's dedication that the lower price permits VW to go after a larger share of midsize sedan shoppers.

"The opportunity is for VW to bring the Passat right to the core of the midsize market," he said. "So there is a dramatic shift in terms of the market that is accessible to the Passat and VW and we certainly plan to take full advantage of it."

Browning said VW expects the all-new Passat to be one of its two high volume vehicle lines along with the compact Jetta. He said the midsize segment is the largest in the U.S.

VW has a plan, dubbed Mach 18, to overtake Toyota in worldwide sales by 2018 and its beefed-up U.S. presence is pegged to play a major role.

Aaron Bragman, an auto analyst for IHS Automotive, said VW has set Toyota products firmly in its sights.

"They want to try to be Toyota in many ways," he said. "They want the volume and market share."

But, Bragman said, the less expensive Passat comes with some risk to VW. He said VW has taken features out of the new Passat to reach the price point.

"You can tell if you're a VW fan," he said. "VW could gain share and sales, but it risks alienating its core group of buyers."

Still, an Automotive News Europe report said VW managers fear European customers will see the new Passat's cheaper price and try to ship it abroad to save money over its still-in-production sister version.