The Volkswagen Up! will not be dropped from the local line-up, Volkswagen Group Australia (VGA) managing director John White has explained, despite the sub-compact hatchback going into sales freefall.
“The Up! has not performed at the level that was anticipated.
“We had to readjust our expectations. I think maybe we were chasing too-high volume.”
Introduced late last year to provide a new entry point to the Volkswagen range in this market, the Up! – which is priced at $13,990 for the three-door and $14,990 for the five-door – recorded an average of 304 monthly sales between January and April this year, but fell to an average of just 22 units between March and August.
“What we’ve seen is that when we’ve put money into the car from a tactical perspective, the sales spike, when we take it [deals] off, they drop,” White gave as reasons for the huge drop.
“We want to be more consistent with our approach to the market. Maybe not as aggressive as we were with these wild swings, but I think more of a consistent volume out of Up! than we have been getting."
Yet White also admits that the decision to introduce the Up! with a manual transmission only has hurt sales when more than 60 per cent of buyers in this market choose an automatic transmission. The Up! is available overseas with a single-clutch automatic transmission, but it was decided not to offer that option locally following widespread criticism of the transmission overseas.
Asked whether that decision could be reversed, White replied: “It’s under evalutation. I think it needs it … it’s an automatic driven car [market]”.
He did, however, add that “I don’t anticipate seeing anything for a couple of years”.
Yet Volkswagen Group technical development of transmission development Michael Schafer has said that no other transmission can be added to the current-generation Up!, but revealed exclusively to CarAdvice that the next-generation model due in 2017 will get either a torque converter or dual-clutch automatic transmission.
Despite the failure of Up! locally, White said “I don’t consider dropping it” from the Volkswagen line-up.
It means Volkswagen will have to hold onto the Up! until the next-generation model lobs in 2017 or 2018 to score the automatic transmission crucial for sales success in Australia.