Volkswagen AG is planning to introduce a subcompact sports utility vehicle in the United States as early as 2016, according to Marc Trahan, executive vice president of VW of America. Trahan said that the new SUV might be built at the carmaker’s Chattanooga site in Tennessee. He said that VW has made a “significant investment” in Chattanooga.
He also said that VW wants to realize the full potential of this site. Trahan's statement was the clearest indication that the Chattanooga plant may build the SUV, which could also be built in Mexico, depending on the decision of the group’s top management.
Volkswagen is seeking to increase its sales in the US as part of its goal to become the largest carmaker in the world in terms of sales by 2018. The German carmaker posted a 1.3-percent drop in sales of VW-brand vehicles in the US in the first eight months of 2013 to 282,913 units.
According to Trahan, VW is set to make a decision by the end of the year on where it will produce its compact SUV. He noted that cost will play a role in deciding the production location – a factor which Chattanooga plant has the advantage of over the site in Mexico.
Trahan remarked that while for him, the answer is obvious, the decision has to “go through a pretty deliberative decision-making process." He said that “additional product will go in" the Chattanooga plant, adding that it is only a matter of “when and what."