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Volkswagen CrossBlue Previews Future SUV

Siegen, Germany -- The Volkswagen CrossBlue concept feels very much like a real car. Get inside. The cabin has wood graining, leather, and stitching. The air-conditioning and turn signals work. It even has Wi-Fi access. Alas, the Volkswagen CrossBlue concept is just a show car. We're only allowed to drive it up to 20 mph, despite the fact that we have an airfield in Siegen, Germany all to ourselves. Still, driving it isn't the point right now.

Revealed at the Detroit auto show in January, the Volkswagen CrossBlue concept is a preview of an all-new midsize SUV from Volkswagen that will cater to the tastes of red-blooded Americans. A production version will likely arrive as a 2016 model. This is why we now find ourselves about sixty miles east of Cologne driving a concept car at low speed. The Volkswagen CrossBlue concept is that important to VW. It could mean increased sales, profits, and an even stronger presence in the United States.

Volkswagen's U.S. executives have been pleading with Germany for this vehicle because they feel that the company needs an SUV that will be a true competitor to the Ford Explorer, Chevrolet Traverse, Honda Pilot, and Toyota Highlander. This is a lucrative segment in which Volkswagen will need to be a player if it is to be successful in its quest to increase sales.

"We've really identified that midsize SUV as our top priority in terms of rounding out the core Volkswagen product portfolio, and that's really at the top of the priority list," Volkswagen Group of America chief executive Jonathan Browning says.

This vehicle is the embodiment of the contemporary American SUV: The production version will seat up to seven (the concept has space for six), and its long wheelbase allows for a cavernous interior, an elevated ride height, and blocky styling that looks like a Dodge Durango from some angles. It is clearly a salvo at American automakers and the consumers who prefer large vehicles.

"Downsizing is not happening in the U.S.," says Volkswagen AG board member and sales chief Christian Klingler. "At the end of the day everybody loves a small car but is driving a big one."

The production CrossBlue (it will get a different name in production trim, but we don't yet know what it will be called) will be a big vehicle, but Browning is quick to characterize it as a midsize SUV. It will slot below the Touareg and above the Tiguan in the brand's U.S. portfolio. That doesn't seem to make sense at first blush, as the CrossBlue is longer and wider than the 2013 Touareg. However, the Touareg is expected to grow when it undergoes its next redesign in 2018, and it will remain VW's most expensive SUV.

The fact is that Volkswagen needs another SUV in its lineup because the Touareg never took off in America. Even though it has been generally well received, the Touareg is expensive and heavy. In many ways it's comparable to the Phaeton, a nicely executed luxury sedan that didn't resonate with American buyers. The numbers reinforce that perception: the Touareg's sales are down 10 percent through August, and Tiguan sales have remained flat even as the U.S. auto sector has rebounded. That performance will not help VW as it aims to sell 800,000 vehicles in the United States and 10 million worldwide annually by 2018.

VW is strongly considering building the new SUV at its factory in Chattanooga, Tennessee, though Klingler says a decision is six to twelve months away. "We are discussing this and have not made a decision yet," he says. Labor concerns, exchange rates, and capacity are all weighing on Volkswagen, which has made headlines recently as the UAW is attempting to organize the Chattanooga plant.

Intriguingly, there is another vehicle that could boost volume at Chattanooga. While in Germany, we overheard that Volkswagen could round out its SUV lineup with a production version of the sexy Cross Coupe concept. That car would be based on the same underpinnings (which VW calls MQB) as the production CrossBlue but would be focused on style rather than utility.

Actually driving the CrossBlue concept is a bit of a nonevent, as its speed is limited. The CrossBlue runs a plug-in hybrid diesel powertrain that produces a total of 305 hp and 516 lb-ft of torque (expect something more conventional for production) paired with a six-speed DSG transmission. The batteries are lithium-ion, and VW estimates an 89 mpg-e rating in electric mode and 35 mpg when run as a conventional hybrid.

Obviously, we didn't get to verify much of that. As small aircraft took off and landed at the Siegerland airport, we maneuvered mainly in straight lines with a few turn-arounds for the benefit of cameramen documenting the proceedings. The steering felt realistic, as this prototype uses the column from the Golf. The chassis is not calibrated, and we crashed jarringly over a small inclined road when exiting the strip. Even when putting the throttle flat to the floor, our top speed was 20 mph. Well, maybe 21 mph or 22 mph. VW says this is because the wheels are not certified to go above a certain speed.

Regardless, this CrossBlue concept is a good representation of VW's future SUV. It was pulled together in six months by an elite team of twenty people inside Volkswagen, and the fact that it moves at all is impressive given the time constraints. VW doesn't want the CrossBlue to be viewed simply as a superficial design exercise. It had to show us that it could run to demonstrate how close the SUV is to production.

"For us, a show car needs to be ready for the experience," says Dzemal Sjenar, senior engineer for vehicle concepts. "It needs to be drivable."

At the end of the day, the CrossBlue comes across as something far more significant than an auto show concept. It really could be Volkswagen's vehicle for future sales growth and traction in the U.S. market. Still, we can't help but think of the pitfalls that await VW as it fights for space in a cutthroat segment. While the CrossBlue appears to be ready to enter the fray, there is clearly still work to be done. Evidence of this hits us as we're about to get out of the concept. When shifting into park, the top of the handle comes off in our hand. Whoops. It's a prototype, no big deal. But it also illustrates how much work VW still has to do before it can become a major player in the SUV segment in the United States.