Volkswagen brand offerings from the German automotive group aren’t likely to see a decline in price in the US market anytime soon, despite a market share presently in decline.
So reports Automotive News, which writes that Volkswagen AG Head of Marketing and Sales Christian Klingler insists that the Volkswagen brand has no “major changes needed in terms of our pricing strategy.” This remark came just after VW announced Q1 results which included a 2.7 percent decline in April compared to the same month last year, and a much more worrisome year-to-date decline of 7.5 percent.
In contrast, the US market at large is up 5.4 percent this year-to-date.
While one might expect the Euro’s current weakness to help the Volkswagen brand here in the US, Klingler explains: “It is true that exchange rate has an impact, but we have a big part of the volume of our cars coming directly from the North American market, and as a consequence, volumewise, this impact is not extremely strong.” In fact, says AN, less than 13 percent of the Volkswagen brand’s overall volume was built in Europe and sold here in the US last year. That’s about 46,000 vehicles.
Still, the Volkswagen brand is refusing to implement price cuts and incentives with the express purpose of recovering market share; VW would rather limit losses and maintain current margins during this rough patch for the marque. “We believe it’s the right strategy over the long term,” says Klingler.