The Volkswagen brand needs to Americanize its lineup to attract U.S. more consumers, a belief that Rainer Michel, Volkswagen of America's vice president for product marketing and strategy, intends to transform into reality. Among Michel’s plans include the production of a compact sports utility vehicle, below the Tiguan crossover, that would be assembled in the US and designed according to local preferences. Michel had planned for the compact SUV to get a third row of seats, but VW’s philosophy does not allow sacrificing styling for the extra space. Michel also eyes a slightly larger SUV that would fill the gap between the Tiguan and the mid-sized Touareg SUV.
Michel told Automotive News that any new small SUV has to be produced locally because it is "very tough" to price small cars competitively if they are assembled in Europe. The new locally built model could be assembled at VW's Chattanooga factory, home to the Passat sedan, or its Puebla plant in Mexico, which builds the Jetta and Beetle. On the other hand, VW is expecting a big increase in US demand for diesel drivetrains, which could lead to the introduction of a diesel version of the Tiguan. According to Michel, diesel-powered vehicles account for more than 20 percent of the VW brand's lineup, but the figure could increase to 30 percent if a diesel Tiguan is added.
VW’s dealer council is more optimistic than the carmaker, saying that diesel-powered vehicles could account for around half of VW’s total sales. Michel said that through informal talks with diesel-injection supplier Robert Bosch, he learned that other carmakers plan to introduce diesel engines in the US in the 2013 time frame. Michel expressed optimism for the development, saying that when other carmakers also promote diesels, it could lead to the surge in demand for the vehicle in the US market.