Volkswagen on pace for best year since 1973

Volkswagen on pace for best year since 1973

July 4th, 2012 by Mike Pare in Business Around the Region

A new Volkswagen Passat sits on display on the deck of the Hunter Museum of Art in Chattanooga during a Volkswagen dinner and reception for international media in this file photo.

Photo by Jenna Walker/Times Free Press.

VW SALES

June U.S. sales by model with percent change from a year ago:

• Jetta / 13,604 / down 20.5%

• Passat / 10,252*

• Golf / 4,092 / up 23.6%

• Beetle / 2,914*

• Tiguan / 2,885 / up 16.9%

• CC / 1,859 / down 41.1%

• Routan / 1,057 / down 0.2%

• Touareg / 794 / up 74.9%

• Eos / 713 / down 19.3%

* No comparable sales a year ago

Volkswagen is marking its best U.S. sales year since 1973, led by its redesigned Chattanooga-made Passat, a revamped Beetle and the high-volume Jetta, officials said Tuesday.

The last year VW's American sales were this strong Richard Nixon was president, a George Steinbrenner group bought the New York Yankees for $10 million and FedEx began operations in Memphis.

VW's sales overall in the U.S. rose 34.2 percent in June over the same period last year to 38,170 vehicles. For the first six months, VW of America reported total sales were up 35.4 percent over last year to 208,725.

Frank Trivieri, vice president of sales for VW of America, said a lot of positives exist in the market.

"The cost of money is low, fuel prices have stabilized and the average vehicle is 10 years old," he said in a conference call with reporters and auto analysts.

Other automakers also reported strong June sales: General Motors posted a 16 percent rise over the same period a year ago, Chrysler was up 20 percent while Toyota recorded a 60 percent jump over earthquake-stricken figures last year.

Sales of VW's Passat topped the 10,000 mark in June for the fourth consecutive month and hit an all-time high in the U.S., according to the carmaker.

Trivieri said the Passat's clean diesel model accounted for about 21 percent of the midsize sedan's sales last month.

He said sales of the diesel Passat, or TDI, could be even higher, but production is hindered by a lack of engines.

"There is more opportunity for TDI Passat," Trivieri said. "There is more demand than supply. There is more room if we get more engines."

The VW official said the company is injecting more money into its engine production facility. The Passat TDI engine is made in Poland and shipped to Chattanooga.

Scott Wilson, a VW spokesman in Chattanooga, said the Enterprise South industrial park plant is making more than 600 new gasoline- and diesel-powered Passats a day.

He said a third team of production workers is slated to start on July 30 to meet demand for the vehicle as the plant aims for about 3,500 employees by year's end.

Edmunds.com auto analyst Jessica Caldwell said in a statement that 2012 so far is "a great year" for VW.

"At the core of the company's success is its high-volume sedans," she said, citing Passat and Jetta.

According to The Associated Press, overall U.S. sales of new cars and trucks surged in June, allaying worries that Americans would stop buying because of slower hiring and other jittery headlines.

Pickup truck sales improved as home building perked up. Chrysler's Ram pickup sales rose 12 percent and sales of the Ford F-Series -- which has long been the country's best-selling vehicle -- rose 11 percent, the AP said.

Ford's overall sales rose 7 percent. The Escape small SUV posted its best month ever -- rising 28 percent -- after a new version of the popular vehicle went on sale. Ford said 40 percent of Escapes sold were new models, while the rest were heavily discounted older versions.

Nissan's sales were up 28 percent. Sales of the new Versa and Quest minivan both more than doubled.

The Associated Press contributed to this story.