Michael Horn undoubtedly knows Volkswagen Group better than America.
He’s spent 24 years at the company and was, among other things, responsible for sales and marketing in Europe, but with sales plummeting in the United States, he was named president and chief executive officer of the Volkswagen Group of America, Inc. He’s now responsible for turning around a brand that has lost its momentum since back-to-back years of solid American growth in 2011. The automaker’s dream of selling 800,000 vehicles in the U.S. by 2018 has morphed into a nightmare.
The situation in the United States has become critical in the past 15 months and shows no signs of abating. In July, for example, Volkswagen sold just over 10,000 Jetta sedans, its most popular model in America, which was a drop of 22.1 percent over the previous month, while sales of the Passat sedan dropped 33.6 percent to just 7,222 cars in the same time period.
The one bright spot was the GTI hatchback, which saw sales rise 65% to almost 2,000 cars. Yet even at the height of their sales, the Jetta and Passat never came close to dominating their sectors, while the Wolfsburg-based automaker has nothing to offer in the booming SUV category. Adding to the woes are problems with quality control, resulting in an embarrassing series of recalls, most recently of 150,000 Tiguans manufactured from 2009 through 2014. This followed a recall of 18,500 Routan minivans.
This is the situation Mr. Horn inherits from his predecessor, Jonathan Browning, who cited “personal reasons” for his resignation. He finds himself looking for clues to what American car buyers seek when they look for a new vehicle, a search Volkswagen has been on for decades.