US results came with complacency, says VW AG chief image

Martin Winterkorn, the Volkswagen Ag chief executive officer, says it’s time for a company “apology” to explain the situation the core VW brand faces in the United States.

There, unlike premium brand powerhouse Audi – which has edged up to the fourth place in the luxury segment last year – Volkswagen’s namesake brand has seen customers fleeing the brand in recent years. While talking to representatives of a German car magazine, Winterkorn said his US team must have become complacent after initially the US-produced version of the Passat became highly successful. The following mistakes were severe enough to allow the brand to slip by 10 percent in 2014, while the overall market posted its fifth year of gains. “We were careless and paid the price. We rested too much on the laurels and were not prepared for the response from the Japanese, Winterkorn commented for PS Welt. Last year, he said for Germany’s Der Spiegel magazine that US executives should have been more vocal about the needed market upgrades. He also said his focus was more than ever on the US market – the second largest in the world.

The chief executive of the second largest automaker in the world also acknowledged the primary difference between the core VW brand and Audi, hence the vastly different success story, is that the former still lacks models that can appeal the Americans. Both the Jetta and Passat, former success stories for the brand, are highly functional, practical and durable but lack emotional appeal.