Volkswagen's labor chief says U.S. operations a 'disaster'

Wed Jan 22, 2014 10:43am EST
 
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By Andreas Cremer and Jan Schwartz

WOLFSBURG, Germany (Reuters) - Volkswagen's (VOWG_p.DE: Quote) top labor representative has dubbed the carmaker's U.S. operations a "disaster" and called for more models and swift decisions to revive the German group's declining fortunes in the world's second-largest auto market.

While VW has risen to become the biggest automaker in China and Europe, the group has yet to fully understood how to succeed in the United States, Bernd Osterloh, VW's works council chief, told reporters in Wolfsburg on Wednesday.

"The U.S. are a case of disaster" for VW, said Osterloh, who also sits on the carmaker's supervisory board.

The German multi-brand group last month ousted U.S. divisional chief Jonathan Browning, who oversaw the much-lauded 2011 launch of the midsize Passat, sales of which declined 6.3 percent last year after a 2011/12 surge.

Osterloh echoed criticism from the company's new head of U.S. operations, Michael Horn, who this month said that VW headquarters had paid little heed to the dynamics of the U.S. market.

VW's situation in the United States, where the company has been grappling with losses for years, won't improve until 2016 and it needs more models there, including a pick-up truck, Osterloh said.

At the Detroit auto show in January VW announced plans to make a sport utility vehicle (SUV) for North America as part of a $7 billion investment in the region.

Osterloh lamented that a year after the "CrossBlue" SUV was unveiled, it's still unclear where the model will be built. The carmaker favors its U.S. plant in Chattanooga, Tennessee, over a factory in Puebla, Mexico, a source familiar with the matter told Reuters.   Continued...

 
The Volkswagen logo is displayed on a 2014 Beetle TDI during the North American International Auto Show in Detroit, Michigan January 15, 2014. REUTERS/Joshua Lott