BlueMotion VWs to be Made in the U.S.A.?

(MoneyWatch)  Volkswagen is investing $1 billion in a state-of-the-art car plant in Chattanooga, Tennessee, and Stefan Jacoby, president of VW Group of America, said at a Washington, D.C. forum May 6 that the cars coming out of the plant could include one of the very economical BlueMotion diesels. In Polo form, with a 1.3-liter turbodiesel, it acheives a whopping 60 mpg--better than a Prius.

"We're deeply considering that," Jacoby told BNet.com. "There will most likely be a BlueMotion line in the U.S."

Volkswagen is in the midst of some dramatic change, including a likely merger with part-owner Porsche. A U.S. BlueMotion would fit into Volkswagen's plans to convince Americans to consider its TDI diesels as worthy green competition to hybrids like the Honda Insight and Toyota Prius. Jacoby admits to some ambivalence on the BlueMotion question, largely as a result of fluctuating oil prices. "With $4 a gallon gasoline, small cars became very popular here," he said, "but when the price went down to $2.25, it all started to go away."

Still, Volkswagen is heavily commiting to green diesels for the U.S. With its Audi partners, the "clean diesel team" includes the Jetta TDI (which averaged 58 mpg in a recent 48-state jaunt, breaking a Guinness World Record) and Jetta Sportwagen, the V-6 VW Toureg 2 TDI, the Audi A3 TDI 2.0 and two versions of the Audi Q7, one with V-12 power.

There's a certain scolding quality German executives have when talking to American audiences: Diesels, they say, get as good or better mileage than hybrids, and very low emissions. They're also cheaper.

Johan de Nysschen, president of Audi of America, said at the same Washington forum that the Q7 TDI offers 25 percent fuel-economy reduction over its gas version, lower carbon dioxide emissions, lower nitrous oxide and even lower particulate matter (usually a diesel's weak point) than a gasoline engine. "We have to convince Americans to reconnect to diesel," he said. "Hybrid vehicles seem to be so politically correct, but they do not offer optimal performance in all situations, only in stop-and-go traffic." He added that he does not see swift commercialization of zero emission battery cars on the horizon.

The VW/Audi group saw an improvement of its U.S. market share in April (compared to the same period last year) of 1.4 to two percent. Jacoby says he sees a six percent market share as achievable. Volkswagen sold 314,500 vehicles in the U.S. last year, down 4.5 percent from 2007 (but ahead of the general industry downturn). The lofty goal for the combined companies is to top one million (800,000 Volkswagens and 200,000 Audis) in the U.S. by 2018.

Jim Motavalli photo