Topics: Volkswagen, Automotive industry, General Motors Pages: 3 (740 words) Published: June 30, 2013
Background of Volkswagen
With cars named for climate patterns, insects, and small mammals, Volkswagen (VW) leads the Continent as Europe's #1 carmaker. Along with Golf (Gulf Stream reference) and the New Beetle, VW's annual production of more than 7 million cars, trucks, and vans includes such models as Passat (trade wind), Jetta (jet stream), Rabbit, and Fox.

VW's size means it seldom needs partnerships with rivals, says Mr Winterkorn. Perhaps this is just as well. Judging by its botched hook-up with Suzuki, a mid-sized Japanese maker, VW is not much good at romance. Suzuki's boss, Osamu Suzuki, has filed for divorce and is taking VW to arbitration to force it to sell its 19.9% stake in Suzuki. Among other things, he has complained of being treated like a subsidiary, rather than a partner. VW had hoped to develop cheap cars for emerging markets with Suzuki, which is big in India. Now it must do so alone, at considerable cost.

VW is so big in China that it would be vulnerable to a downturn there. Likewise in Brazil, where its Chinese rivals are starting to encroach. And VW has a closer challenger in its rear-view mirror: Hyundai-Kia, which is pushing upmarket while continuing to churn out small, good-value motors. It has around half of its home market in South Korea, is ahead of VW with a 9% share in America and is making inroads in Europe and emerging markets. And unlike VW, it does not have a profusion of brands to support.

Their competitors would be automakers that are in the "non-luxury" category. From a marketing viewpoint, Volkswagen is not literally considered a "luxury" brand. Their competitors would not be any "luxury" brands such as Acura, Audi, BMW, Cadillac, Infiniti, Jaguar, Land Rover, Lexus, Lincoln, Mercedes, Porsche, Saab and Volvo. Volkswagen no longer carries at least one "luxury" vehicle in their product line. They discontinued the "Phaeton." I recall doing a research paper for a marketing class not too long ago regarding U.S....
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