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Volkswagen was originally founded in 1937 by the Nazi trade union, the German Labour Front . In the early 1930s German auto industry was still largely composed of luxury models, and the average German rarely could afford anything more than a motorcycle. Seeking a potential new market, some car makers began independent "peoples' car" projects – Mercedes' 170H, Adler's AutoBahn, Steyr 55, Hanomag 1,3L, among others. The trend was not new, as Béla Barényi is credited with having conceived the basic design in the middle 1920s. Josef Ganz developed the Standard Superior (going as far as advertising it as the "German Volkswagen"). Also, in Czechoslovakia, the Hans Ledwinka's penned Tatra T77, a very popular car amongst the German elite, was becoming smaller and more affordable at each revision. In 1933, with many of the above projects still in development or early stages of production, Adolf Hitler declared his intentions for a state-sponsored "Volkswagen" program. Hitler required a basic vehicle capable of transporting two adults and three children at 100 km/h (62 mph). The "People's Car" would be available to citizens of the Third Reich through a savings scheme at 990 Reichsmark, about the price of a small motorcycle (an average income being around 32RM a week).
Despite heavy lobbying in favour of one of the existing projects, Hitler chose to sponsor an all new, state owned factory. The engineer chosen for the task was Ferdinand Porsche. By then an already famed engineer, Porsche was the designer of the Mercedes 170H, and worked at Steyr for quite some time in the late 1920s. When he opened his own design studio he landed two separate "Auto für Jedermann" (car for everybody) projects with NSU and Zündapp, both motorcycle manufacturers. Neither project come to fruition, stalling at prototype phase, but the basic concept remained in Porsche's mind time enough, so on 22 June 1934, Dr. Ferdinand Porsche agreed to create the "People's Car" for Hitler.
Changes included better fuel efficiency, reliability, ease of use, and economically efficient repairs and parts. The intention was that ordinary Germans would buy the car by means of a savings scheme ("Fünf Mark die Woche musst Du sparen, willst Du im eigenen Wagen fahren" — "Five Marks a week you must put aside, If in your own car you want to ride"), which around 336,000 people eventually paid into. Volkswagen honoured its savings agreements in West Germany (but not in East Germany) after World War II. Prototypes of the car called the "KdF-Wagen" (German: Kraft durch Freude — "strength through joy"), appeared from 1936 onwards (the first cars had been produced in Stuttgart). The car already had its distinctive round shape and air-cooled, flat-four, rear-mounted engine. The VW car was just one of many KdF programs which included things such as tours and outings. The prefix Volks— ("People's") was not just applied to cars, but also to other products in Europe; the "Volksempfänger" radio receiver for instance. On 28 May 1937, the Gesellschaft zur Vorbereitung des Deutschen Volkswagens mbH was established by the Deutsche Arbeitsfront. It was later renamed "Volkswagenwerk GmbH" on 16 September 1938.
Erwin Komenda, the longstanding Auto Union chief designer, developed the car body of the prototype, which was recognizably the Beetle known today. It was one of the first to be evolved with the aid of a wind tunnel, in use in Germany since the early 1920s. The building of the new factory started 26 May 1938 in the new town of KdF-Stadt, now called Wolfsburg, which had been purpose-built for the factory workers. This factory had only produced a handful of cars by the time war started in 1939. None was actually delivered to any holder of the completed saving stamp books, though one Type 1 Cabriolet was presented to Hitler on 20 April 1938 (his 49th birthday).
War meant production changed to military vehicles, the Type 82 Kübelwagen ("Bucket car") utility vehicle (VW's most common wartime model), and the amphibious Schwimmwagen which were used to equip the German forces.. As was common with much of the production in Nazi Germany during the war, slave labor was utilized in the Volkswagen plant. The company would admit in 1998 that it used 15,000 slaves during the war effort. German historians estimated the that 80% of Volkswagen's wartime workforce was slave labor. Many of the slaves were reported to have been supplied from the concentration camps upon request from plant managers. A lawsuit was filed in 1998 by survivors for restitution for the forced labor. Volkswagen would set up a voluntary restitution fund.
The company owes its post-war existence largely to one man, British Army officer Major Ivan Hirst, REME. In April 1945, KdF-Stadt, and its heavily bombed factory were captured by the Americans, and subsequently handed over to the British, within whose occupation zone the town and factory fell. The factories were placed under the control of Oldham-born Hirst. At first, the plan was to use it for military vehicle maintenance. Since it had been used for military production, and had been in Hirst's words a "political animal" rather than a commercial enterprise — technically making it liable for destruction under the terms of the Potsdam Agreement, the equipment was in time intended to be salvaged as war reparations. Hirst painted one of the factory's cars green and demonstrated it to British Army headquarters. Short of light transport, in September 1945 the British Army was persuaded to place a vital order for 20,000. The first few hundred cars went to personnel from the occupying forces, and to the German Post Office.
Some British Service personnel were allowed to take their VW Beetles back to the United Kingdom when they were demobilised, and one of the very first Beetles brought back in that way (UK registration number JLT 420) is still owned by Peter Colborne-Baber, the son of the original proprietor of the UK's first official Volkswagen Importer, Colborne Garages of Ripley, Surrey. By 1946 the factory was producing 1,000 cars a month, a remarkable feat considering it was still in disrepair. Owing to roof and window damage, rain stopped production and new vehicles were bartered for steel required for more production.
The car, and its town changed their Second World War-era names to "Volkswagen", and "Wolfsburg" respectively, and production was increasing. It was still unclear what was to become of the factory. It was offered to representatives from the British, American and French motor industries. Famously, all rejected it. After an inspection of the plant, Sir William Rootes, head of the British Rootes Group, told Hirst the project would fail within two years, and that the car "is quite unattractive to the average motorcar buyer, is too ugly and too noisy … If you think you're going to build cars in this place, you're a bloody fool, young man". In an ironic twist of fate, Volkswagen would manufacture a locally built version of Rootes's Hillman Avenger in Argentina in the 1980s, long after Rootes had gone bankrupt at the hands of Chrysler in 1978—the Beetle outliving the Avenger by over 30 years.
Ford representatives were equally critical: the car was "not worth a damn," according to Henry Ford II, the son of Edsel Ford, although he did reportedly look at the possibility of taking over the VW factory, but dismissed the idea as soon as he looked up Wolfsburg on the map and found it to be too close for comfort to the East German border.In France, Citroën started the 2CV on a similar marketing concept. Meanwhile, in Italy, the Fiat 500 "Topolino" was developed
In Occupied Germany, the Allies followed the Morgenthau Plan, to remove all German war potential, by complete or partial pastoralisation. As part of this, in the Industrial plans for Germany, the rules for which industry Germany was to be allowed to retain were set out. German car production was set at a maximum of 10% of the 1936 car production numbers.
As mentioned above, the Volkswagen factory at Wolfsburg came under British control in 1945; it was to be dismantled and shipped to Britain. Thankfully for Volkswagen, no British car manufacturer was interested in the factory; "the vehicle does not meet the fundamental technical requirement of a motor-car … it is quite unattractive to the average buyer … To build the car commercially would be a completely uneconomic enterprise". The factory survived by producing cars for the British Army instead. Allied dismantling policy changed in late 1946 to mid 1947, although heavy industry continued to be dismantled until 1951. In March 1947 Herbert Hoover helped change policy by stating: "There is the illusion that the New Germany left after the annexations can be reduced to a 'pastoral state'. It cannot be done unless we exterminate or move 25,000,000 people out of it". Thanks to the protection of British Army Major Ivan Hirst, Volkswagen survived the perilous times, and became part of the German economic recovery.
From 1948, Volkswagen became a very important element, symbolically and economically, of West German regeneration. Heinrich Nordhoff (1899–1968), a former senior manager at Opel who had overseen civilian and military vehicle production in the 1930s and 1940s, was recruited to run the factory in 1948. In 1949 Major Hirst left association with the company, as it had now been re-formed as a trust, controlled by the West German government, and the government of the State of Lower Saxony. Apart from the introduction of the Volkswagen Type 2 commercial vehicle (van, pick-up and camper), and the VW Karmann Ghia sports car, Nordhoff pursued the one-model policy until shortly before his death in 1968.
Volkswagens were first exhibited and sold in the United States in 1949, but only sold two units in America that first year. On its entry to the U.S. market, the VW was briefly sold as a "Victory Wagon". Volkswagen of America was formed in April 1955 to standardise sales and service in the United States. Production of the Type 1 Volkswagen Beetle increased dramatically over the years, the total reaching one million in 1955.
Sales soared—thanks in part to the famous advertising campaigns by New York advertising agency Doyle, Dane Bernbach. Led by art director Helmut Krone, and copywriters Julian Koenig and Bob Levinson, Volkswagen advertisements became as popular as the car, using crisp layouts and witty copy to lure the younger, sophisticated consumers with whom the car became associated. Even though it was almost universally known as the Beetle (or the Bug), it was never officially labelled as such by the manufacturer, instead referred to as the Type 1. The first reference to the name Beetle occurred in U.S. advertising in 1968, but not until 1998 and the Golf-based New Beetle would the name be adopted by Volkswagen. Although the car was becoming outdated, during the 1960s and early 1970s, American exports, innovative advertising, and a growing reputation for reliability helped production figures surpass the levels of the previous record holder, the Ford Model T. On 17 February 1972 the 15,007,034th Beetle was sold. Volkswagen could now claim the world production record for the most-produced, single make of car in history. By 1973, total production was over 16 million.
To commemorate its passing the Ford Model T's record sales mark and its victories in the Baja 1000 Mexican races from 1967 to 1971, Volkswagen produced its first limited-edition Beetle. It was marketed as the "Baja Champion SE" in the United States and the "Marathon" Superbeetle in the rest of the world. It featured unique "Marathon Blau" metallic blue paint, steel-pressed 10-spoke 15-inch (38 cm) magnesium-alloy wheels, a commemorative metal plate mounted on the glovebox and a certificate of authenticity presented to the original purchaser. Dealer-installed options for this limited-edition Superbeetle included the following: white stripes running the length of the rocker-panel, a special shifter knob, bumper overriders, tapered exhaust tips, fake walnut inserts in the dashboard (behind the steering wheel and the glovebox cover) as well as Bosch fog lights mounted on the front bumper.
VW expanded its product line in 1961 with the introduction of four Type 3 models (Karmann Ghia, Notchback, Squareback) based on the new Type 3 mechanical underpinnings, and again in 1969 with the larger Type 4 (411 and 412) models. These differed substantially from previous vehicles, with the notable introduction of monocoque/unibody construction, the option of a fully automatic transmission, electronic fuel injection, and a sturdier powerplant. Volkswagen added a "Super Beetle" (the Type 113) to its lineup in 1971. The Type 113 differed from the standard Beetle in its use of a MacPherson strut front suspension instead of the usual torsion bars. Also the nose of the car was stretched 2 inches (51 mm) to allow the spare tire to lie flat, and the combination of these two features significantly increased the usable front luggage space. Despite the Super Beetle's (marketed outside North America as the VW 1302, later 1303) popularity with Volkswagen customers, purists preferred the standard Beetle with its less pronounced nose and its original torsion bar suspension. In 1973, Volkswagen introduced the military-themed Type 181, or "Trekker" in Europe and the UK, "Thing" in America, recalling the wartime Type 82. The military version was produced for the NATO-era German Army during the Cold War years of 1970 to 1979. The US Thing version only sold for two years, 1973 and 1974, thanks at least in part to Ralph Nader's automobile safety campaigns.
In 1964, Volkswagen succeeded in purchasing Auto Union, and in 1969, NSU Motorenwerke AG (NSU). The former company owned the historic Audi brand, which had disappeared after the Second World War. VW ultimately merged Auto Union and NSU to create the modern day Audi company, and would go on to develop it as its luxury vehicle marque. However, the purchase of Auto Union and NSU proved to be a pivotal point in Volkswagen's history, as both companies yielded the technological expertise that proved necessary for VW to survive when demand for its air-cooled models went into terminal decline as the 1970s dawned.
Volkswagen was in serious trouble by 1973. The Type 3 and Type 4 models had sold in much smaller numbers than the Beetle and the NSU-based K70 also failed to woo buyers. Beetle sales had started to decline rapidly in European and North American markets. The company knew that Beetle production had to end one day, but the conundrum of replacing it had been a never-ending nightmare. VW's ownership of Audi / Auto Union proved to be the key to the solution – with its expertise in front-wheel drive, and water-cooled engines which Volkswagen so desperately needed to produce a credible Beetle successor. Audi influences paved the way for this new generation of Volkswagens, known as the Passat, Scirocco, Golf and Polo. First in the series was the Volkswagen Passat (Dasher in the U.S.), introduced in 1973, a fastback version of the Audi 80, using many identical body and mechanical parts. Estate/wagon versions were available in many markets. In Europe, the estate/wagon version dominated in market share for many years. In spring 1974, the Scirocco followed. The coupe was designed by Giorgetto Giugiaro. Based on the platform of the not yet released Golf, it was built at Karmann due to capacity constraints at Volkswagen.
The pivotal model emerged as the Volkswagen Golf in 1974, marketed in the United States and Canada as the Rabbit for the 1st generation (1975–1985) and 5th generation (2006–2009). Its angular styling was designed by the Italian Giorgetto Giugiaro). Its design followed trends for small family cars set by the 1959 Mini — the Golf had a transversely mounted, water-cooled engine in the front, driving the front wheels, and had a hatchback, a format that has dominated the market segment ever since. Beetle production at Wolfsburg ended upon the Golf's introduction. It continued in smaller numbers at other German factories (Hanover and Emden) until 1978, but mainstream production shifted to Brazil and Mexico.
In 1975, the Volkswagen Polo followed. It was a re-badged Audi 50, which was soon discontinued in 1978. The Polo became the base of the Volkswagen Derby, which was introduced 1977. The Derby was for all intents and purposes a three-box design of the Polo. After a second model generation, the Derby was discontinued in 1985. Passat, Scirocco, Golf and Polo shared many character defining features, as well as parts and engines. They built the basis for Volkswagen's turn-around.
While Volkswagen's range of cars soon became similar to that of other large European automakers, the Golf has been the mainstay of the Volkswagen lineup since its introduction, and the mechanical basis for several other cars of the company. There have been six generations of the Volkswagen Golf, the first of which was produced from the summer of 1974 until the end of 1983 (sold as the Rabbit in the United States and Canada and as the Caribe in Latin America). Its chassis also spawned the Volkswagen Scirocco sport coupe, Volkswagen Jetta saloon/sedan, Volkswagen Golf Cabriolet convertible, and Volkswagen Caddy pick-up. North American production of the Rabbit commenced at the Volkswagen Westmoreland Assembly Plant near New Stanton, Pennsylvania in 1978. It would be produced in the United States as the Rabbit until the spring of 1984. The second-generation Golf hatchback/Jetta sedan ran from late 1983 to late 1991, and a North American version produced at Westmoreland Assembly went on sale at the start of the 1985 model year. The production numbers of the first-generation Golf has continued to grow annually in South Africa as the Citi Golf, with only minor modifications to the interior, engine and chassis, using tooling relocated from the New Stanton, Pennsylvania plant when that site began to build the Second Generation car.
In the 1980s, Volkswagen's sales in the United States and Canada fell dramatically, despite the success of models like the Golf elsewhere. The Japanese and the Americans were able to compete with similar products at lower prices. Sales in the United States were 293,595 in 1980, but by 1984 they were down to 177,709. The introduction of the second-generation Golf, GTI and Jetta models helped Volkswagen briefly in North America. Motor Trend named the GTI its Car of the Year for 1985, and Volkswagen rose in the J.D. Power buyer satisfaction ratings to eighth place in 1985, up from 22nd a year earlier. VW's American sales broke 200,000 in 1985 and 1986 before resuming the downward trend from earlier in the decade. Chairman Carl Hahn decided to expand the company elsewhere (mostly in developing countries), and the New Stanton, Pennsylvania factory closed on 14 July 1988. Meanwhile, four years after signing a cooperation agreement with the Spanish car maker SEAT in 1982, Hahn expanded the company by purchasing a majority share of SEAT up to 75% by the end of 1986, which VW bought outright in 1990.
Volkswagen had entered the supermini market in 1975 with the Volkswagen Polo, a stylish and spacious three-door hatchback designed by Bertone. It was a strong seller in West Germany and most of the rest of Western Europe, being one of the first foreign small cars to prove popular in Britain. The second-generation model, launched in 1981 and sold as a hatchback and "coupe" (with the hatchback resembling a small estate car and the coupe being similar to a conventional hatchback), was an even greater success for Volkswagen. It was face-lifted in 1990 and was still selling well after 13 years, when it was replaced by the third-generation Polo in 1994.
In 1991, Volkswagen launched the third-generation Golf, which was European Car of the Year for 1992. The Golf Mk3 and Jetta arrived in North America just before the start of 1994 model year, first appearing in southern California in the late spring of 1993. The sedan version of the Golf was badged Vento in Europe, but remained Jetta in the U.S.
The late 1990s saw a gradual change in perception of the company's products – with Audi having elevated itself into same league as BMW and Mercedes-Benz, Volkswagen moved upmarket to fill the void left by Audi; with SEAT and the further addition of the Czech car maker Škoda being acquired in the late 1990s, now occupying what was once VW's core market.This move upmarket was continued with the Golf Mk4, introduced at the end of 1997 (and in North America in 1999), its chassis spawned a host of other cars within the Volkswagen Group—the Volkswagen Bora (the sedan called Jetta in the U.S.), New Beetle, SEAT Toledo, SEAT León, Audi A3, Audi TT, and Škoda Octavia.
The other main models have been the Polo, a smaller car than the Golf, and the larger Passat for the segment above the Golf. The Scirocco and the later Corrado were both Golf-based coupés.
The Volkswagen New Beetle
In 1994, Volkswagen unveiled the J Mays-designed Concept One, a "retro"-themed concept car with a resemblance to the original Beetle, based on the platform of the Polo. Due to a positive response to the concept, a production version was developed as the New Beetle, based on the Golf's larger platform.
Volkswagen's fortunes in North America improved once the third-generation Golf and Jetta models became available there. Marketing efforts included Trek bicycles with accompanying bicycle racks on the 1996 Jetta sedan. The introductions of the New Beetle and the fifth-generation Passat were a major boost to the brand.
In the UK, Volkswagen's market share grew throughout the 1990s. In 1990, the Golf was Britain's 12th most popular car with nearly 50,000 units sold. The Mk3 Polo achieved similar success in the mid 1990s, but in 1999 the Mk4 Golf was Volkswagen's first ever entrant in Britain's top 10 list of most popular new cars.
In the late 1990s Volkswagen acquired the three luxury brands Lamborghini (through Audi), Bentley, and Bugatti due to Ferdinand Piëch" strategy. Audi's plans for Lamborghini included a small supercar later to be named the Gallardo, and a new halo vehicle, the Murciélago, and later the Reventon limited edition halo car. In late 2008, a 4-door saloon for the Lamborghini brand was shown in the form of the Lamborghini Estoque concept.
For Bentley, its future within the Volkswagen Group seemed bright as the launch of the Bentley Continental range helped Bentley post record-breaking sales of 10,000.
Bugatti, after Volkswagen purchased the rights to use the name, showed three concept cars, the Bugatti EB110 (coupé and saloon) and the Bugatti Chiron. Bugatti then launched the Veyron hypercar, with a top speed of 252 mph (406 km/h). Although Bugatti makes a huge loss on every Veyron, Volkswagen is still going to keep the brand and maybe will launch a new Rolls Royce Phantom-rivaling saloon rumoured to be called Royale.
Volkswagen began introducing an array of new models after Bernd Pischetsrieder became Volkswagen Group CEO (responsible for all Group brands) in 2002. The sixth-generation VW Golf was launched in 2008, came runner-up to the Opel/Vauxhall Insignia in the 2009 European Car of the Year, and has spawned several cousins: VW Jetta, VW Scirocco, SEAT León, SEAT Toledo, Škoda Octavia and Audi A3 hatchback ranges, as well as a new mini-MPV, the SEAT Altea. The GTI, a "hot hatchback" performance version of the Golf, boasts a 2.0 L Turbocharged Fuel Stratified Injection (FSI) direct injection engine. VW began marketing the Golf under the Rabbit name once again in the U.S. and Canada in June 2006. (The GTI had arrived to North America four months earlier). The fifth-generation Jetta, and the performance version, the GLI, are also available in the United States and Canada. The sixth-generation Passat and the fifth-generation Jetta both debuted in 2005, and VW has announced plans to expand its lineup further by bringing back the Scirocco by 2008. Other models in Wolfgang Bernhard's (Volkswagen brand CEO) "product offensive" include the Tiguan mid-sized SUV in 2008 and a Passat Coupé. In November 2006 Bernd Pischetsrieder announced his resignation as Volkswagen Group CEO, and was replaced by Audi worldwide CEO Martin Winterkorn at the beginning of 2007. Winterkorn is credited with making Audi a challenger to the dominance of BMW and Mercedes, and his design-led strategy has led to Audi being considered one of the most important brands in the world.Nevertheless, Volkswagen continues to have complicated relations with both unions and shareholders. The German state of Lower Saxony owns 20% of the stock.
In North America, VW faced many challenges. After rising significantly between 1998 and 2001, VW's North American sales began to fall sharply leading to a 2005 loss of roughly US$1 billion for its operations in the U.S. and Canada. Profitability has not been strong, and the lack of reliability of the company's cars appears to bear some of the responsibility for this situation. By 2005, its models sat near the bottom of Consumer Reports reliability ratings, and J.D. Power and Associates ranked VW 35th out of 37 brands in its initial quality survey. Attempts to enter a new market segment also compromised Volkswagen's standing in North America. In 2002, Volkswagen announced the debut of its Phaeton luxury car, which was critically acclaimed but not well received in the marketplace. VW announced its discontinuance in the U.S. market for the 2007 model year due to the disappointing sales.
Volkswagen in 2005, despite challenges, still maintained North American sales of 224,195—a dramatic increase from the low in 1993 when US sales totalled only 49,533 vehicles. Momentum continued for fiscal 2006, as VW's North American sales for the year were 235,140 vehicles, a 4.9 percent increase over 2005, despite a slump in domestic North American manufacturer's sales. VW plans to close out the decade with the release on several new vehicles worldwide and a barrage of advertising. In conjunction with the introduction of new models, production location of Volkswagen vehicles also underwent great change. The 2007 Eos, a hardtop convertible, is produced in a new facility in Portugal. All Golfs/Rabbits and GTIs as of 2006 are manufactured in Wolfsburg, Germany, rather than VW's Mexican factory in Puebla, where Golfs and GTIs for the North American market were produced from 1989 to 1998, and the Brazilian factory in Curitiba, where Golfs and GTIs were produced from 1999 to 2006. (The Jetta has primarily been made in Mexico since 1989). VW is also in the process of reconfiguring an automotive assembly plant in Belgium. The new models and investments in manufacturing improvements were noticed immediately by automotive critics. Favorable reviews for VW's newest cars include the GTI being named by Consumer Reports as the top sporty car under $25,000, one of Car and Driver magazine's "10 Best" for 2007, Automobile Magazine's 2007 Car of the Year, as well as a 2008 Motor Trend comparison ranking the mid-size Passat first in its class. The J. D. Power and Associates 2006 Automotive Performance, Execution and Layout (APEAL) Study scored Volkswagen fourteenth overall with strong performances by its new Jetta and Passat models.
Volkswagen is recognised as one of the leading small diesel engine manufacturers, and is partnering with Mercedes and other companies to market BlueTec clean diesel technology. Volkswagen has offered a number of its vehicles with a TDI (Turbocharged Direct Injection) engine, which lends class-leading fuel economy to several models. According to the United States Environmental Protection Agency, four of the ten most fuel-efficient vehicles available for sale in the U.S. in 2004 were powered by Volkswagen diesel engines. They were a three-way tie for 8th (TDI Beetle, TDI Golf, TDI Jetta) and ninth, the TDI Jetta Wagon. As of 2007, VW has not yet offered a gasoline/electric hybrid powertrain such as that in the Toyota Prius (though a diesel-electric hybrid 5th generation Jetta was produced as a test vehicle). In addition, all Volkswagen TDI diesel engines produced from 1996 to 2006 can be driven on 100% biodiesel fuel. For the 2007 model year, however, strict U.S. government emissions regulations have forced VW to drop most diesels from their U.S. engine lineup, but a new lineup of diesel engines compatible to U.S. standards returned to the American market starting with Model Year 2009. These post-2009 Clean Diesel engines are limited to running on 5% (B5) biodiesel only to maintain Volkswagen's warranty.
Volkswagen long resisted adding a utility vehicle to its lineup, but it finally relented with the introduction of the Touareg in the early 2000s, sharing major components with the Porsche Cayenne and Audi Q7 sport utility vehicles. Though acclaimed as a fine handling vehicle, the Touareg has been a modest seller at best. Some automotive analysts blame the Touareg's absence of a third-row seat, the relatively poor fuel economy, and the high vehicle mass. VW plans to add a compact SUV with styling influences from its "Concept A" concept vehicle. On 20 July 2006, VW announced that the new vehicle would be called the Tiguan. Since the discontinuance of the T4 in 2003 and decision not to bring the T5 to the US market, it was ironic that Volkswagen lacked a van in its North American lineup considering that VW was a major player in the development of the class with its original Transporter. The firm did however launch a rebadged DaimlerChrysler named the Volkswagen Routan for the U.S. and Canadian markets in 2008. Owing to technical difficulty adapting the Polo to meet North American vehicle regulations, VW presented in 2006 the "Iroc" as a concept of the proposed 2009 Scirocco as a potential new small model.
In September 2006, Volkswagen began offering the City Golf and City Jetta only for the Canadian market. Both models were originally the Mk4 Golf and Jetta but were later replaced with the Brazilian versions of the Golf Mk4 and Bora. The City Golf and City Jetta were introduced to compete with the Toyota Yaris and Honda Fit. Volkswagen's introduction of such models is seen as a test of the market for a subcompact and, if successful, may be the beginnings of a thriving subcompact market for Volkswagen.
When Martin Winterkorn became the eighth postwar CEO of Volkswagen, the company made several personnel changes in Wolfsburg. Though the VW Group already had their presence in India with Škoda Auto, Volkswagen introduced the Passat and Touareg with TDI engine to India's automobile market in September 2007.
The VW 1L will be available in 2010, in limited numbers. The 1L is a lightweight two-person vehicle made out of a magnesium frame covered by an unpainted carbon-fiber skin. Every component of the vehicle is intended to reduce the vehicle's weight. Aluminum brakes, carbon-fiber wheels, titanium hubs, and ceramic bearings all contribute to the vehicle's light weight of a mere 290 kg. To reduce the weight even further, and to increase the aerodynamics of the vehicle, there are no rearview mirrors. Instead, the car is equipped with cameras that display visual information to the driver through the internal LCD screen. The car is extremely fuel-efficient, each gallon of fuel will take you over 235 miles (378 km). The fuel tank holds just 1.7 gallons, making the entire travel distance capability about 400 miles (640 km) per tank. Its top speed is 120 km/h , which although not very fast is a welcome tradeoff for the huge savings in fuel consumption.
In May 2011 Volkswagen inaugurated the Volkswagen Chattanooga Assembly Plant. The plant will produce cars specifically designed for North America beginning with the New Midsize Sedan, which will be compete with North American market leaders Toyota Camry and Honda Accord. Production is scheduled to begin in early 2011 and is expected to end more than five years of losses in the world's largest auto market.In 9 December 2009, Volkswagen AG and Suzuki reached a common understanding to establish a close long-term strategic partnership. Volkswagen will purchase 19.9% of Suzuki’s issued shares.
In February 2010, Volkswagen announced the latest Polo BlueMotion model with a 1.2 litre TDI three-cylinder common rail diesel engine rated at 75 PS and 133 ft·lbf (180 N·m) of torque from 2000 rpm. This model emits 91g/km of CO2 and has a combined cycle fuel consumption of 80.7 mpg.