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Volkswagen Delivers Solid Profit Despite Diesel Scandal

U.S. buyback program set to get underway.

by on Oct.27, 2016

The Porsche Macan helped drive big profits for the brand - and for parent Volkswagen AG.

As it begins to see its massive diesel scandal fade into the rearview mirror, Volkswagen AG reported Thursday a big jump in third-quarter earnings.

The German maker had a net, after-tax profit of 2.34 billion euros, or $2.55 billion. By comparison, VW went 6.7 billion euros into the red a year ago as it set aside funds to cover fines and legal costs triggered by the revelation it had rigged emissions tests on its 2.0- and 3.0-liter diesel engines.

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On Tuesday, a judge in San Francisco gave final approval to a nearly $15 settlement with U.S. and California regulators covering the smaller of the two powertrains. That includes up to $10 billion to buy back the 475,000 Audi and Volkswagen brand vehicles sold in the U.S. using that engine. VW says buybacks are likely to begin by mid-November, though the maker still hopes to come up with a technical fix for at least some of those vehicles.

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VW Steps Up Operations in Tennessee

New stamping plant partnership will add 500 jobs, simplify supply chain.

by on Jun.23, 2015

VW will build a version of its CrossBlue Concept when it completes the Chattanooga plant expansion.

Volkswagen continues to expand its operations in Tennessee, and with the German maker already set to double the size of its Chattanooga assembly plant it will also partner with supplier Gestamp to set up a new stamping plant near the assembly line.

The $180 million project will create another 500 jobs, improve basic logistics and allow the use of an advanced hot stamping process yielding ultra-high-strength steel panels that are lighter, more fuel-efficient and safer, according to Volkswagen.

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“The importance of this expanded partnership for Volkswagen and Chattanooga cannot be overstated,” said Christian Koch, President and CEO of Volkswagen Chattanooga. “We have put another crucial pillar into place for our future success and the benefits of this expansion will impact the community for years to come,” Koch added during a news conference in Chattanooga.

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VW Launching New 3-Row Tiguan at Puebla Plant

$1 bil project aimed at filling gap in maker’s SUV line-up.

by on Mar.09, 2015

VW will add about 1 million square feet to its already huge Puebla, Mexico plant for the new Tiguan.

Volkswagen will drop $1 billion into its assembly plant in Puebla, Mexico to produce a new three-row version of the Tiguan sport-utility vehicle.

It’s the latest step in a costly program meant to expand VW’s utility vehicle line-up and increase its competitive position in the U.S. market. The German maker has struggled to rebuild sales even as the overall American market continues to boom, and a lack of utes has been one of its biggest problems, senior officials believe.

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The Puebla plant is already one of Volkswagen’s larger global facilities, handling a range of products including the latest-generation Golf hatchback. And it will now take on the Tiguan when the $1 billion expansion is completed late next year, in time for the start of the 2017 models.

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Though Revenues Slip, VW Beats Q2 Earnings Expectation

Audi drives profit surge.

by on Jul.31, 2014

VW CEO Martin Winterkorn wants to balance profitability and aggressive growth going forward.

The world’s second-largest automaker beat expectations with a strong second quarter profit, up 14.1%, despite a decline in revenues.

The Thursday release of Volkswagen AG’s earnings revealed that its biggest luxury line, Audi AG, helped offset some problems at its namesake brand. The report came as VW begins a major effort to shift its focus from raw growth to a more profitable expansion plan, with Chief Executive Officer Martin Winterkorn planning to cut costs and boost productivity.

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“In light of the continued strong competitive pressures, the tense situation in some emerging economies and the fundamental technical and economic changes happening in our industry, we are working hard to create all the conditions we need today to ensure success tomorrow,” the CEO said in a statement accompanying the earnings release.

VW earned 3.25 billion Euros, or $4.35 billion, during the second quarter, up from 2.85 billion during the same period a year ago. The consensus of 13 industry analysts polled by the Bloomberg news service had anticipated earnings of 3.31 billion Euros.

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VW Investing $900 Mil to Expand Tenn. Plant, Add New CrossBlue SUV

German maker will also set up new product development and planning center at Chattanooga plant.

by on Jul.14, 2014

The VW CrossBlue Concept vehicles rolls past the maker's assembly plant in Chattanooga, TN.

After a long delay, Volkswagen officials have finally confirmed plans to expand the capacity of their big assembly plant in Chattanooga, Tennessee to produce and all-new midsize crossover-utility vehicle, a project that will cost the maker about $900 million.

After achieving significant growth earlier in the decade, VW is currently struggling to reverse a two-year sales slump that has threatened to leave it short of the ambitious goals it had set for 2018 when the company was hoping to sell 800,000 vehicles a year in the U.S. Based on the CrossBlue Concept vehicle, the new ute will play a “key role” in VW’s plans for the U.S. and broader North American market, declared the maker’s CEO Martin Winterkorn during an online news conference.

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“The Volkswagen brand will continue to go on the offensive in the American market,” said Winterkorn, who called the U.S. “one of the most important markets” for his company.

The VW CEO also announced that the German maker will add a new product development and planning center at the Chattanooga complex.

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VW Likely to Delay Ambitious U.S. Sales Targets

Product delays, focus on China catch blame.

by on May.13, 2014

Volkswagen plans to begin selling a midsize SUV, based off the CrossBlue, in the U.S. in 2016.

Volkswagen’s ambitious growth plans for the U.S. market are likely to be delayed – but are still within long-term reach, according to the maker’s top U.S. executive.

The German maker had set itself a goal of selling 800,000 vehicles a year in the U.S. under the flagship VW brand by 2018, while also sharply boosting sales of the Audi luxury brand. But while Volkswagen has enjoyed a significant increase in volume since the plan was first announced, growth has slowed in recent years, sales actually dipping slightly in 2013.

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And with demand dipping even further for the first months of this year, meeting the 800,000 target by 2018 now seems out of the question, Michael Horn, the 25-year Volkswagen veteran who recently took over U.S. operations, told TheDetroitBureau.com. (more…)

Tennessee’s Anti-Union Approach May Stall Plans to Expand VW Plant

Maker might look for other options to build CrossBlue model.

by on Apr.08, 2014

The CrossBlue Concept was slated to be produced at the company's plant in Tennessee, but the efforts by state and national lawmakers to chase off the UAW, may have cost the plant the vehicle.

The state’s political leaders did everything they could to keep the union out of Volkswagen’s big assembly plant in Chattanooga, Tenn., but they may also have short-circuited plans by the automaker to expand that factory to add production of a major new crossover-utility vehicle.

Barely two months after workers at the VW factory narrowly voted against the United Auto Workers Union, plans for the new Volkswagen CrossBlue model appear to have ground to a halt, in part due to delays over proposed state incentives meant to offset the cost of that factory expansion.

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And with the Tennessee legislature set to soon adjourn for the year, VW may be left with no option but to consider alternative production plans, several sources cautioned. They note that the automaker has become increasingly wary of working with Tennessee in the wake of the union flap – several top state leaders directly criticizing the company for inviting the UAW vote. (more…)

VW Hopes to Charge up LA Auto Show Audiences with Twin Battery Cars

CrossBlue Coupe Concept to join e-Golf on show stand.

by on Nov.15, 2013

VW's CrossBlue concept made its original debut in Shanghai. The maker suggests it will be updated for its American unveiling.

Volkswagen aims to electrify L.A. Auto Show-goers when it rolls out two battery-based models next week, including both the new e-Golf – its first battery-electric vehicle for the U.S. market – and an updated version of the CrossBlue Coupe Concept first unveiled earlier this year in Shanghai.

We offered TheDetroitBureau.com readers a first look at the e-Golf this week, and now turn to the CrossBlue, a 5-seat plug-in hybrid that we almost certainly will see again, suggests Klaus Bischoff, Head of Design for the Volkswagen Brand.

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“The disproportionate growth in the SUV segment gives designers the opportunity to implement an even greater diversification of models,” explains Bischoff, adding that, “The CrossBlue Coupé shows the potential of our Volkswagen design DNA and will undoubtedly have an influence on future SUV models.”

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VW Postpones Decision on Tennessee Plant Expansion, 2nd Product

But announcement likely before year-end.

by on Jun.26, 2013

VW says the CrossBlue Concept was designed specifically for the US market.

Volkswagen has some big news for Tennessee – but not the news many had expected.  The German maker has invested another $40 million in the state, about two hours from its sprawling Chattanooga assembly complex, to add a new regional distribution center. But the announcement sidestepped the really big decision many have been expecting.

VW has signaled that it will soon decide whether to add a second product line to the U.S. plant – a move that could lead it to double the size of the Chattanooga facility, expanding capacity to as much as 500,000 units annually.

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“We expect a decision in 2013,” Carsten Kreb, communications director for Volkswagen Group of America Inc. said in an e-mail. But no decision has yet been taken as to whether and, if so, which model this could be built at the plant.

However, it appears almost certain – as TheDetroitBureau.com reported last week – that the Chattanooga plant will eventually produce a version of the CrossBlue Concept, a three-row crossover-utility vehicle that would help expand Volkswagen’s presence in the rapidly expanding CUV market.

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VW Unveils CrossBlueCoupe Concept

Plug-in concept can run 20 miles on battery – or power your home during a blackout.

by on Apr.19, 2013

VW rolls into Shanghai with the CrossBlue Coupe Concept, a plug-in hybrid with 20 miles battery range.

We got an unofficial sneak peek at the Volkswagen CrossBlue Coupe Concept earlier this week when a handful of renderings leaked out on the Web. Now, the maker is giving us an official preview prior to the weekend unveiling at the 2013 Shanghai Auto Show.

Like the 3-row CrossBlue crossover concept that was first seen at the Detroit Auto Show last January, the Coupe uses the compact MQB “architecture” that will be the foundation for more than half of all Volkswagen Group vehicles to come in the future, whether Seat, Skoda, Audi — or Volkswagen, which based the new Golf on the MQB.

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The plug-in hybrid prototype also suggests that VW is getting into the coupe/crossover segment that has caught on with so many of its German rivals.

The CrossBlue Concept features a long and broad hood – with short overhangs and a long, sweeping roofline.  The goal was to create a more sporty stance than that of the more traditional CrossBlue CUV unveiled in Detroit.

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