Volkswagen to Modify New Vehicle Introduction Strategy

Current All or Nothing Launch Strategy is Boom or Bust for Dealers

It's a classic case of the tortoise and the hare. The pace of new product launches every four years is frantic for Volkswagen, however just before the wave of new

Volkwagen dealers are anxiously awaiting the North American release of the new Golf V. (Photo: Volkswagen Canada)

models is released a sales siesta takes place that causes the Wolfsburg, Germany automaker's beancounters to go frantic for different reasons - one being a lack of cash.

Of course it's only natural for sales volumes to ebb and flow from year to year for a variety of reasons. The most obvious has to do with specific models. When a car is at the end of its "shelf" life it usually creates less of a stir in the market due to outdated styling, less trendsetting features and the fact that most people who were going to buy it already have. When the new model comes out there's a general buzz among those that old the outgoing model, with many stepping up to purchase. After the new car has been out for a while, and providing it's different enough in appearance over the old model, those that may

A number of factors are responsible for Volkswagen's North American division's USD$1 billion nosedive last year. (Photo: Volkswagen Canada)

have not considered buying the car before will either step up from a car from the same brand or swing over from an altogether different automaker (conquest sales).

The product for sale isn't the only reason for fluctuating sales volumes, with the general economic market playing a key role, but that's nothing that can be controlled by a car manufacturer.

At the automaker's recent annual meeting, Volkswagen AG CEO Bernd Pischetsrieder acknowledged that its bipolar product cycle and dollar to euro ratio, among other contributing factors, have cost its North American division more than USD$1 billion last year.