Pivoting to a lineup that’s heavy on CUVs and light on passenger cars has the Volkswagen and Audi brands on a roll in the U.S. market, including record first-half volume for Audi, and the highest first-half sales for the VW brand in the U.S. since 1973.
“VW made a commitment in 2017 to move from passenger sedans to more SUVs,” says Earl Reed (pictured, below left), general manager of Ontario (CA) Volkswagen. The three-row VW Atlas kicked off the “SUV revolution” in 2017 for the 2018 model year, he says in a recent phone interview.
In the first half of 2021, the VW brand’s sales were 211,373, up 46% vs. 2020. The first-half 2021 brand mix is 69% trucks and 31% cars, according to Motor Intelligence. Four years ago, VW’s U.S. sales were 14% trucks, 86% cars, in first-half 2017.
Audi’s U.S. sales in the first half were 121,835, up 59.9% vs. a year ago. That includes a mix of 70% trucks, up from 51% four years ago.
“We’re doing 70-plus percent of our volume in SUV segments that are super-hot,” says Ray Mikiciuk, senior vice president-sales for Volkswagen of America. In the second quarter, trucks accounted for 73% of sales, the company says.
“We have five SUVs in the portfolio,” Mikiciuk says in a phone interview. Those are the three-row VW Atlas, the two-row Atlas Cross Sport, the new ID.4 crossover electric vehicle, the recently introduced Taos and the Tiguan.
While VW Group executives refer to the vehicles as SUVs, Wards Intelligence classifies them as cross/utility vehicles (CUVs) built on unibody architectures, rather than body-on-frame SUVs.
Meanwhile, since first-half 2020, VW has dropped the Beetle, Beetle Convertible, e-Golf, CC, Golf Sportwagen, Tiguan Limited and Touareg vehicles. Starting with the 2022 model year, VW is dropping the base-model VW Golf in the U.S. market.
Aggressive incentives and marketing have also boosted U.S. sales in the first half, Mikiciuk says. Promotions have included a “Sign and Drive” lease offer starting in March 2021, featuring no money due at signing, no down payment, no security deposit and no payment on the first month of the lease.
Loan offers included zero-percent APR for 72 months for all 2021 models in March and April. The zero-percent term was later limited to 60 months, and recently to 36 months, he says.
Like other brands across the industry, VW is working to allocate a limited number of the computer chips used in manufacturing throughout the lineup, but the automaker hasn’t been hit by the computer chip shortage as hard as many other brands, Mikiciuk says.
VW expects the worst of the computer chip shortage may be over, he says. “It’s a daily task, for us to acquire the componentry we need and produce at the levels we’re predicting to do,” he says. “We see it getting better in Q3 and much better in Q4.”