VW may axe Taos and Jetta under restructure

[wemay]

VW has shared it's struggles as of late and i understand some models have to go. But why entry level vehicles? Wouldn't this place the brand further out of reach for so many? Hopefully this just speculation.

https://www.caranddriver.com/news/a71921037/vw-jetta-taos-porsche-taycan-chopping-block-report/

 

[dogememe]

That's dumb, that's the only two newer VW products I see on the road on a daily basis. Atlas seemed to do well for a few years but they seem rare now.

 

[skyactiv]

The hard reality is that Americans don't want to buy cars. The Mazda6, Subaru Legacy, Passat and Impreza among others sedans are no more.
Here is a thought I have. Cars like an Accord sell for less than a Honda Pilot. The Pilot cost more to make, but not as much as you'd think. Auto makers make a lot more profit on a mid sized SUV than on a car.

 

[wemay]

The hard reality is that Americans don't want to buy cars. The Mazda6, Subaru Legacy, Passat and Impreza among others sedans are no more.
Here is a thought I have. Cars like an Accord sell for less than a Honda Pilot. The Pilot cost more to make, but not as much as you'd think. Auto makers make a lot more profit on a mid sized SUV than on a car.

I agree. But that still leaves the Taos.

 

[SC Maintenance]

No margin maybe?

Kinda like Ford only wanting to sell trucks?

Short term thinking.

 

[AZjeff]

No margin maybe?

Kinda like Ford only wanting to sell trucks?

Short term thinking.

So makers should sell a few cars at a low margin and higher costs due to low production until people might start buying them again? If people prefer SUVs and CUVs now instead of sedans what will change their mind? Maybe the last maker making sedans will gain the sales needed.

FWIW my daughter's 2025 Jetta base is a nice car with more features than you need and has had no problems. She likes it, I'd never buy one.

 

[MrBubba]

The VW Jetta and Golf are the only VW cars I would consider buying seems like a dumb decision.

The Jetta is their only sedan meanwhile they have 5 different SUV options, that should be where their focus is.

 

[SC Maintenance]

So makers should sell a few cars at a low margin and higher costs due to low production until people might start buying them again? If people prefer SUVs and CUVs now instead of sedans what will change their mind? Maybe the last maker making sedans will gain the sales needed.

FWIW my daughter's 2025 Jetta base is a nice car with more features than you need and has had no problems. She likes it, I'd never buy one.

Not telling anyone what to do. There only obligation is to there shareholders. Only speculating on why they might be exiting those markets?

 

[edyvw]

VW has shared it's struggles as of late and i understand some models have to go. But why entry level vehicles? Wouldn't this place the brand further out of reach for so many? Hopefully this just speculation.

https://www.caranddriver.com/news/a71921037/vw-jetta-taos-porsche-taycan-chopping-block-report/

How else do you think they ended up in this situation?

 

[RBT]

VW has shared it's struggles as of late and i understand some models have to go. But why entry level vehicles? Wouldn't this place the brand further out of reach for so many? Hopefully this just speculation.

https://www.caranddriver.com/news/a71921037/vw-jetta-taos-porsche-taycan-chopping-block-report/

It is the same reason the U.S. car companies like trucks and SUVs - it is a more profitable vehicle that better suits their higher cost base. But it stinks for enthusiasts because cars like the Golf and the Jetta are nicely sized and fun to drive.

 

[macarose]

They have to cut something and the easiest ones to eliminate are the least profitable models.

It's been that way for decades on end. Either you get the very tip of a market nobody really wants anymore (Sebring convertibles, MINI subcompacts) or you take that money and invest in a segment that offers better returns.

 

[SC Maintenance]

They have to cut something and the easiest ones to eliminate are the least profitable models.

It's been that way for decades on end. Either you get the very tip of a market nobody really wants anymore (Sebring convertibles, MINI subcompacts) or you take that money and invest in a segment that offers better returns.

True. But I think it also means there abandoning the developing world and first time buyer. They likely have no choice. So begins the death spiral.

 

[Finklejag]

What’s the cheapest Ford these days? They got rid of all their sedans and hatchbacks. You want entry level Ford, the base Bronco Sport will set you back $32K.

The Taos is pretty much the same price as half of the trims on the larger Tiquan. I noticed when I bought VW’s back in the day. The difference between invoice and MSRP was like $2000-$2500. These days it’s like $500. VW isn’t making money producing these models in today’s environment.

 

[Hirev]

But why entry level vehicles?

In my area you just don't see many newer VW entry level vehicles these days. Been like that for some time. The Toyota Corolla, Honda Civic, Hyundai Elantra, and Mazda3 all left US sales of entry level cars of the VW in the dust.

 

[KGMtech]

I read about 1 year ago that the Taos was the vehicle rated the #1 that people regretted purchasing. I think it was because it was typically poorly equipped to meet a price point.

 

[DCDG]

I thought I stumbled across an article that there was a want for sporty sedans to come back by the 35-40 year old population.

 

[JeffKeryk]

True. But I think it also means there abandoning the developing world and first time buyer. They likely have no choice. So begins the death spiral.

Exactly, and not just the developing world. I don't think GM and Ford have a car in the top 10 ww or US sales. And only the US buys their full size trucks in large quantities. Camry/Accord and Corolla/Civic do pretty well. I imagine Hundai ain't no slouch either.

All your eggs in 1 basket...

 

[AZjeff]

Where is the Tesla entry level car? Someone here crows about Tesla's profitability, surely they can put one together and make money with it....?

 

[JeffKeryk]

Where is the Tesla entry level car? Someone here crows about Tesla's profitability, surely they can put one together and make money with it....?

The Model 2 was supposed to be built in “very high volume,” Musk said in 2023, but by April of the following year, the Model 2 was all but dead, supposedly pushed back/killed in favor ot other projects, one was the butt-ugly Cybertruk. Why? Musk got too full of himself?

Then it was the Cybercab and Robotaxi. There is some thought that this could be used for a Model 2 platform. Who knows?
We can only speculate what success might have been if Tesla had delivered a Model 2 instead of the CT.
It certainly would have consumed some of the huge Corolla/Civic market segment.

As you point out. Tesla's GAAP GM% is currently under pressure, down to 16.8% in Q2 2026 down from 21.1% in Q1.
While they came in low compared to Tesla's historical margins, they remain higher than legacy automakers. That's the numbers.
Detailed Cost Accounting and analysis was one of my responsibilities in corporate metrics reporting.

 

[edyvw]

VW is the dumbest company around.
Again, to repeat myself, they have on sale a Tiguan hybrid in the EU from 2020, while the hybrid will arrive in the US sometime in 2028/2029.
They are trying to protect Audi, which might not exist as a company in 10 years. They purposely degraded Atlas, which was supposed to be their best bet on the US market for Audi, which sells so many new models that you can see one every leap year on the street.
At the same time, they packed the Teramont, the Chinese Atlas, with all the goodies, turbo VR6 engine, etc., just to get booted out of the market by the CCP.
But, IMO, VW is a mirror of today's Germany. Besides BMW and, to a certain extent, Mercedes, they have serious structural and confidence issues. I just got back from there. Flew from Turkey to Berlin. Those of you who have flown recently to the EU know how cumbersome the EES system is when getting into the EU or leaving. Turkey does the same: take fingerprints and a photo. No problems, super efficient. Got to Berlin. My God! What a mess. Only four booths open, hundreds of people, two guys sitting in booths for EU citizens, but there are no EU citizens in line. They just sit, look at the crowd etc. I am thinking to myself: "The German efficiency at work in Turkey."
Spending some time there kind of gave me a better understanding of the issues, and VW is just a mirror of that. But one thing is sure: they won't give up their zeal to lower emissions even if their economy goes to the toilet, which would allow some serious crazies to come to power.