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Volkswagen details brand realignment strategy for U.S. market; aims for middle class buyers

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On: Sat, May 7, 2016 at 8:18AM | By: Carl Malek


Volkswagen details brand realignment strategy for U.S. market; aims for middle class buyers

Despite the ongoing emissions scandal that has generated its fair share of woes for the company as a whole, Volkswagen is embarking on an ambitious yet crucial brand strategy that aims to completely revamp the way the company does business here in the U.S., a market that the company lists as one of its key targets for its long term future.

"We believe that the USA has in fact the greatest for Volkswagen worldwide in the next decade," Volkswagen brand chief, Herbert Diess, announced at a press conference in Germany. Automotive News was there, and had blunt words for Volkswagen's plans calling them a far-fetched "miracle view". While this is a pretty cold assessment, it does show the long-term challenges the company will face in regaining consumer trust.

Diess went on, "We didn't succeed in giving the brand a clear profile and consistent product portfolio that could allow us to expand step by step in the market." This long-term strategy also goes beyond mere moves at the corporate level, and a sedan-centric plan of attack with crossovers such as a long wheelbase version of the Tiguan and a new mid-size model to add depth.

Instead Diess wants the company to focus on a demographic that he calls the "aspirational middle class". This group would include customers who have positive experiences with models such as the original Beetle and the Microbus. However, Diess stated that his team is still waiting for input from the parent company on how he can proceed with this approach without stepping into the territory of premium-focused brands such as Audi, especially in terms of potential sales cannibalization, as well as clashing marketing strategies.

However, in the midst of this positive outlook, the company is still dealing with the massive blow to its reputation that the emissions scandal has brought, a fact that Diess brought out into the open when he outlined a rudimentary timeline for the plan, stating "naturally not in the near future, since we are starting from zero in the U.S.". Hopefully this plan will not only help the company go on the right path towards consumer reconciliation, it will also allow Volkswagen to re-embrace the basic virtues that helped make its past products resonate so well with the middle class back in its 60s heyday.




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