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After the ‘hippie’ bus and Beetle, VW makes eyes at America once more

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As Volkswagen looks to resurrect the Scout brand in the US, CEO Herbert Diess has make clear the choice, saying it represents a possibility for the German auto giant to “develop into far more American.” 

VW announced plans to re-launch the Scout as a fully-electric pick-up and “rugged” SUV last Wednesday, with prototypes because of be revealed in 2023 and production planned to start in 2026.

In the identical announcement, the corporate said the vehicles could be “designed, engineered, and manufactured within the U.S. for American customers.”

“America is our biggest growth opportunity,” Diess, who was talking to CNBC’s Annette Weisbach last week, said.

He went on to clarify why the automaker was targeting the fiercely competitive American market.

“We’re still very area of interest, very small, with about 4% market share [in the country],” he said. “We wish to stand up to 10% market share towards the tip of this decade.”

Diess stressed that the firm had momentum, was profitable and “really making good progress with the electrical cars.”

These vehicles include the fully electric ID Buzz, which is inspired by the T1 Microbus or “hippie” van. European versions of the ID Buzz are set to go on sale this yr, with sales of an American model starting in 2024.

This image, from 1970, shows people driving a version of the Volkswagen Microbus at a rock festival in Oregon.

Brian Payne/Pix | Michael Ochs Archives | Getty Images

VW hopes that the introduction of the Scout and ID Buzz will proceed its tradition of introducing iconic designs to the U.S. market. Through the years, these have included the Beetle and various iterations of the Microbus, akin to the one pictured above.

The Scout’s history dates back to the Nineteen Sixties, when International Harvester — originally an agricultural company, now often called the Navistar International Corporation — began development. Today, Navistar is a component of the Traton Group, a subsidiary of the Volkswagen Group.

Production of the Scout ceased in 1980, but Volkswagen’s decision to re-launch it, and Diess’ comments, provide some clues to its strategy going forward.

“If we actually need to develop into relevant in America, we now have to have a look at the opposite segments,” he said. “And pick-ups, big SUVs, are very, very big in America.”  

Diess went on to explain Scout as a “beloved brand in the US. So it’s a very good opportunity for us to develop into far more American.”

Read more about electric vehicles from CNBC Pro

Asked if the Scout pickup could be solely for the U.S. market, he was non-committal. “I would not say ‘entirely dedicated’ but firstly … it’s an American product.”

“It’ll be an American product for American customers, designed for the American environment. Will it’s sold outside? Possibly, later to be decided,” Deiss added.

VW is planning to establish a separate and independent company this yr to design, engineer and manufacture the Scout pick-ups and SUVs for the U.S. market.

Volkswagen’s concentrate on electric vehicles is a world away from the “dieselgate” scandal that rocked it within the 2010s. Today, its electrification plans put it in direct competition with long-established automakers like GM and Ford, in addition to relative newcomers akin to Tesla.

On the corporate’s overall prospects within the U.S. going forward, Diess was bullish.

“We’re increase capacities in the US … later this yr, around August, ID 4 production will start in our Chattanooga facilities,” he said.

“We’ve got programs for Audi and Porsche to extend their market share and … we’ll see some more products, electric products, being produced in America, for America.”

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