agent Entrepreneur logo
MenuMENU
SearchSEARCH

VW Dealers To Get More Crossovers Because of Ukraine Conflict

Volkswagen Group will shift production to China and North America after wire harness and other material shortages from Russia's invasion of Ukraine impact European production.

March 17, 2022
VW Dealers To Get More Crossovers Because of Ukraine Conflict

 

Credit:

Volkswagen

2 min to read


 

The Ukraine-Russia conflict will put more new crossovers on the lots of U.S. Volkswagen dealerships in upcoming months.

CEO Herbert Diess told reporters at a press conference that the German automaker would shift more production to North America and China, at least temporarily, as a result of the war.

Ad Loading...

The move is expected to increase output from VW-brand plants in Chattanooga and Puebla, Mexico, as well as the Audi plant in San Jose Chiapa, Mexico, all of which assemble crossovers mostly sold in the U.S. Chattanooga produces the VW Atlas and Atlas Cross Sport and builds non-saleable pilot versions of the ID4 battery-electric crossover. Puebla assembles the VW Tiguan and Taos. The Audi plant produces the popular Q5.

VW’s China plants will also benefit, as microchips destined for use in Europe are reallocated to China and North America.

The most significant supply chain constraint at the moment are wire harnesses produced in Ukraine, Diess said. If VW cannot reallocated production (from Germany to other plants) in three to four weeks, the automaker’s outlook will need revision, Diess said.

Diess also warns semiconductor shortages, supply bottlenecks, high commodity prices and the Russia-Ukraine conflict will trim growth in 2022 as challenges mount against the auto industry.

VW brand sold 375,030 vehicles in the U.S. in 2021, up 15% from 2020. About 73% of these sales were crossovers. The automaker captures 2.5% of U.S. auto sales and when sales from other group brands, Audi, Porsche, Bentley and Lamborghini, are included its market share jumps to 10%.

Ad Loading...

Tom McMenamin, chairman of the VW National Dealer Advisory Council, confirmed dealers will see more North American-built vehicles heading to their lots in 2022. He speculated that getting more crossovers from Chattanooga and Puebla for VW's 638 U.S. dealerships will allow the brand to gain U.S. market share as other automakers struggle with their own supply constraints

Originally posted on Auto Dealer Today

More Industry

Group photo of men outside storefront.
Industryby Hannah MitchellMay 28, 2026

Pennsylvania Dealership Under New Retailers

The sale of the Chrysler Dodge Jeep Ram store puts a family auto group on a leaner path as first-time dealers take the helm.

Read More →
Hallway with lockered wiring and computer
Industryby Lauren LawrenceMay 28, 2026

Battery Storage Takes Priority Over EVs

U.S. automakers are prioritizing battery energy stationary storage over electric-vehicle production as the consumer demand for EVs lags the rest of the world.

Read More →
Gray-scale photo of a line of Mini cars in a dealership parking lot
Industryby Hannah MitchellMay 27, 2026

Auto Dealers Feel Better But Not Great

A second-quarter Cox Automotive poll of franchised retailers and independents found better views of the current market after a good spring but anticipation of third-quarter storminess.

Read More →
Ad Loading...
Closeup photo of the front of a white car
Industryby Hannah MitchellMay 21, 2026

New-Vehicle Sales Picture Relative

A May forecast is complicated by last spring’s trade tariff effects on auto retail. Despite continued hard realities, many consumers took advantage of ways to bite the bullet.

Read More →
Nissan logo on front of building
Industryby Lauren LawrenceMay 21, 2026

Auto Group Acquires Third Nissan Rooftop

Iowa-based Coleman Automotive Group recently acquired its seventh dealership, McGrath Nissan, which it renamed Nissan of Elgin.

Read More →
Couple talking with auto salesman next to new car inside dealership
Industryby Hannah MitchellMay 20, 2026

April Less Affordable

Based on prices, reduced incentives and slower household income growth, consumers found it more challenging to buy new last month, Cox Automotive reported.

Read More →
Ad Loading...
Wooden people figures of different colors in a row, similar to board game pieces
IndustryMay 20, 2026

Building an Extraordinary F&I Agency

Work to determine your specialized talent, because that fact will determine everything about your agency’s future.

Read More →
Photo of new Chevrolet Bolt parked on a beach
Industryby Hannah MitchellMay 14, 2026

EVs Getting More Attractive

A growing percentage of U.S. consumers are open to switching and fewer are adverse to the idea, according to a recently completed survey. That’s despite the end of a tax break.

Read More →
Benchmark bar graph showing April 2026 EV Sales
Industryby Lauren LawrenceMay 14, 2026

EV Sales Drop in April Following Surge

North American electric-vehicle sales were down 28% year-over-year, a sharp contrast from global EV sales growth of 6%.

Read More →
Ad Loading...
Photo of a loan contract on a desk
Industryby Hannah MitchellMay 13, 2026

Auto Lenders, Consumers on a Tightrope

April borrowing data shows that more consumers are bending over backward to buy vehicles, though subprime lending cooled off for the month.

Read More →