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March 12, 2021

Volkswagen PH Ready to Turn a New Chapter by Going Global

Volkswagen is confident of turning a new chapter here in the Philippines starting this year. In its seventh (going eighth) year in the market, VW Philippines is going global in its image, products, and services.

During a media roundtable, Volkswagen Philippines President Felipe Estrella III admits that the Ayala-backed automaker had some hiccups. When the brand first launched, its line up were mostly diesel-powered (and expensive) sedans. Then, in a shock move, it decided to start importing Chinese market sedans and SUVs from VW’s joint-venture partner, SAIC.

Estrella says that Volkswagen has always been about providing mobility. When the brand first launched, they tried to offer vehicles which they thought would appeal to buyers, but was hindered by external factors such as existing trade agreement and tariffs. When they shifted to sourcing from China, they managed to bring their prices down. However, Estrella admits that they were unable to make the public appreciate what they were offering.

“We are saddened that despite our successful effort to bring down prices by reducing friction costs all the while maintaining the Volkswagen standard of quality, we are unable to make the public appreciate and focus on the good value proposition of the products that we are offering,” said Estrella.

“We will continue to work to tell prospective customers that the Philippines is fortunate to be the only market that has access to products that are available exclusively to the largest VW market in the world [China].  These products, while different in name, are still built to the same standards and on the same global MQB, A05, and A5 platforms of VW.  This is truly an undiscovered secret,” he continued.

Moving forward, Estrella says they’re putting that all behind them now. Starting with the T-Cross, they’re once again aligning themselves to being “global Volkswagen.”

Though still made in China, the T-Cross will be the first truly global product that’ll be launched by Volkswagen Philippines in a while. Sold in every continent (barring Antarctica), it sold more than 300,000 units last year and is underpinned by the MQB platform. It will be, according to Estrella the “adobo” or “sisig” in the Volkswagen menu.

Volkswagen Philippines hasn’t revealed any details yet, but they said it will be launched by the second quarter of this year. Indicative pricing will be between P 1.1 to P 1.3 million. This will be followed by two more mystery models one coming in the third quarter, and the other in the last quarter of 2021. Both of these will be global models with one being a non-SUV.

On the aftersales side, the German car brand has also promised to reduce overall ownership costs. Aside from its once-a-year maintenance, Volkswagen Philippines has now pushed for parts inventory good for three months (including collision parts) and specialized tools. All in all, they have promised a competitive cost of ownership compared to mainstream brands.

Do you think Volkswagen can finally hit pay dirt with this move?

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