Diesel Passat production goes into high gear

Diesel Passat production goes into high gear

May 2nd, 2012 in Business Around the Region

Employees of Volkswagen of Chattanooga gather in a hall at the company's Chattanooga plant.

Photo by Doug Strickland /Times Free Press.


April U.S. sales by model and change from last year:

Jetta, 15,658, down 7.6%

Passat, 10,096, n/a

Golf, 3,876, up 14.6%

Tiquan, 2,333, down 16.4%

Beetle, 2,065, up 25,712%

CC, 1,136, down 64.1%

Eos, 735, up 10%

Routan, 908, down 2.9%

Touareg, 718, up 12.2%

Source: VW of America

Volkswagen plans to boost Chattanooga production of its fast-selling diesel Passat, which soon could make up more than a quarter of cars assembled at the plant.

The move comes as the automaker's total U.S. sales in April were the best for the month in 41 years and up 31.5 percent from a year ago, officials said Tuesday.

"Momentum for the VW brand continues despite more moderate retail demand across the industry," said Jonathan Browning, VW of America's chief executive. "We expect growth momentum to continue."

Total Passat sales for April hit a monthly best of 10,096, almost a third of the 37,525 vehicles VW sold in America last month.

Passats with the fuel-stingy diesel engines make up about 19 percent of sales, Browning said.

"We're looking to move capacity in the TDI in Chattanooga to well above 25 percent," he said in a conference call with reporters.

Edmunds.com senior analyst Jessica Caldwell said the company is dominating the passenger car diesel market with its Passat and Jetta offerings at a time of high fuel prices.

"This sort of brand depth gives VW something that really separates the German brand from its competitors," she said in a statement. Passat's diesel engine can get about 43 miles per gallon on the highway and nearly 800 miles on a single tank.

VW reported that year-to-date sales were up 38 percent compared to 2011. Browning said VW appears to be taking sales from automakers such as Honda, Ford and Toyota.

Frank Trivieri, VW of America's vice president of sales, said sales of its top-selling Jetta are holding up even with the launch of the new Passat.

Also, he said April sales of the Beetle were the company's best since 2003.

At the Chattanooga plant, officials already have said they're adding 1,000 jobs this year to meet demand. That will push the plant's headcount to about 3,500 workers.