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Go Figure: Volkswagen Targets SUV Growth to Boost Sales in U.S.

A new midsize car is already on the way, but Volkswagen is targeting extra growth in the SUV ranks to help acquire more customers in the United States auto market.

Bloomberg recently interviewed Volkswagen’s U.S. head Jonathan Browning to see where the German marque was looking to gain sales.

“We will be looking to really grow, particularly in the compact SUV segment,” said Browning. “Over time, I think there’s also scope for growth in terms of a larger SUV within the portfolio.”

The compact crossover segment’s sales numbers speak for themselves. In 2010, the utilitarian yet well-respected Honda CR-V sold 203,714 units. The Toyota RAV4 grabbed 170,877 sales; the Chevrolet Equinox managed 149,979 (platform twin GMC Terrain achieved 60,519). Long overdue for a replacement, the Ford Escape still watched 191,026 vehicles move to new owners. For comparison, VW’s relatively unknown Tiguan saw just 20,946 CUVs change hands. Clearly, the customers are waiting.

Browning’s talk of a possible larger SUV doesn’t bode well for the Touareg. The midsize SUV has the feel of a premium product, including a very premium starting price tag of $45,270. VW sold just 4713 Touaregs in all of 2010, though some would argue its lack of a third row is a big influence on this segment’s buyers. A proposed full-size SUV would presumably possess the extra seats, but it’d likely need to see production at VW’s new plant in Chattanooga, Tennessee, to have a sustainable price.

“We’ve got plenty of ideas in terms of new product entries,” continued Browning. “It’s very important that we build a balance of our product portfolio in the U.S.”

All this product talk comes as VW continues to eye its million-unit U.S. sales goal for 2018, with 200,000 coming from Audi sales. Last year, VW sold 256,830 vehicles, good for an 11-percent market gain led primarily by the compact Jetta. In addition to revamped SUVs, the upcoming New Midsize Sedan (to be unveiled at the Detroit show) is also a critical component of VW’s master plan. The NMS will be assembled in Tennessee and is expected to make up a hefty chunk of sales in the future.

The Tiguan is powered by VW’s popular 2.0-liter TSI straight-four with 200 horsepower, and starts at $24,305 (includes an $820 destination charge) with a six-speed manual. Pricing is definitely a hurdle in the Tiguan’s attempt to move up the ladder, but could it add anything else to make it more appealing to its target demographic? Give us your opinions in the comments section below.

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