Sales Of The Tennessee-Made VW Passat Are Going The Wrong Way

Currently, Volkswagen Chattanooga only builds the Passat, which has struggled catching on in the competitive American sedan market segment. Credit: VW

Sales for the only car currently produced by Volkswagen’s Chattanooga plant dropped by 10 percent in October, and so far this year are down by more than a third compared to 2013.

The 6,500 Passats sold in October represent a new low: The same month last year was a low point for the Passat at the time, which had been underperforming since production moved to Chattanooga in 2011. Last year, VW had to cut 500 contract workers because of an oversupply.

“This is one of the few plants in the country that is severely underused at the moment,” AutoPacific analyst Dave Sullivan says, citing other automakers which are making record gains. “You’ve got to wonder what they’re doing in the assembly plant. There’s not enough sales to go around, so the future’s not looking too good right now.”

A VW spokesperson says workers are staying busy, in part by exporting Passats to 10 Arabic countries, Mexico, Canada and South Korea.

The company blames some of the U.S. sales trouble on a 3-year-old design. VW will have a “refreshment” of the Passat next year, the spokesperson says, but no complete overhaul has been announced. Other automakers in the competitive sedan segment update their models every five years or so.

Despite the sluggish sales, VW is moving ahead with a massive expansion of the plant subsidized by the state of Tennessee. A new assembly line will start building a crossover SUV for the American market.