VW Aims for a Big U.S. Comeback

(MoneyWatch)  Expect to see a lot more of everything from Volkswagen of America in the next decade, starting right about now -- more advertising, more products, and hopefully, from their point of view, a lot more cars on the road than you've ever seen from VW, even back in the 1960s.

That's because VW and its Audi luxury division have set the astounding goal of 800,000 U.S. sales by 2018. That's way more than double 2007 sales of 328,000, including the Volkswagen, Audi, Bentley and Lamborghini brands.

It's also way more than VW's salad days in the United States. VW's previous U.S. sales record was 569,000 units in 1970.

Key to the plan is a $1 billion VW plant in Chattanooga, Tenn. VW confirmed on July 15 it will build the plant. Production is supposed to start in 2011.

VW has had its ups and downs with North American production. Its last U.S. plant, in Westmoreland, Penn., ran from 1978 to 1988, but had quality problems and high costs. VW centralized its production in Mexico, but quality there was initially so bad, the U.S. sales and marketing subsidiary refused to take delivery for a model year, until the problems got fixed.

The new factory in Tennessee will build up to 250,000 cars a year. VW could export some, but it sounds as if most of the U.S. production is earmarked for the U.S. market.

If VW is going to come close to its goal, it will need to hugely raise its U.S. profile. Advertising starts next month for an all-new model, the Routan minivan, built by Chrysler for VW, closely based on a Chrysler minivan.