NAIAS 2018: VW Works To Earn Back Trust; Toyota, Ram Introduce New Models

Quiet cabins, Wi-Fi connectivity, wireless charging, LED headlights, Apple CarPlay and Android Auto are no longer differentiators.

Just about every automaker boasted these features Monday at the North American International Auto Show in Detroit.

Volkswagen Introduces New Product After Diesel Scandal 

With eight U.S.-based production and creation teams, Volkswagen AG (ADR) VLKAY is taking a more pointed stab at the American market.

“We want to continue to gain market share and grow from a niche player to a truly relevant brand in the United States,” Hinrich Woebcken, president and CEO of Volkswagen Group of America, said. “... I’m confident our recent sales momentum will be carried over in 2018 and our SUV will lead the way.”

A focus on SUVs over its classic small cars has been integral to the mission.

And the strategy seems to be working. After releasing the Atlas and T1 in 2017, the automaker ended the year with its best deliveries in company history. Sales were up 5.2 percent against the industry’s 1.8-percent drop and the Atlas registered increasing sales.

“Here in the U.S., we are laying the groundwork to position Volkswagen as a relevant volume manufacturer,” Chairman Herbert Diess said.

Diess acknowledged the damage from VW's 500,000-car, $15-billion diesel emissions scandal in the U.S.

"We have disappointed many people, and not just here in America. We must and we will make up for that," he said. 

The VW executives touted the automaker's "People First" transferable warranty, a six-year, 72,000-mile, bumper-to-bumper plan.

The focus continues with the rollout of three new vehicles targeting the U.S. market.

On Monday, Volkswagen unveiled its 2019 Jetta sedan, which has long been the company’s best-selling model in the U.S. The update has adaptive cruise control and lane departure warnings, and its infotainment system integrates more deeply with Apple Inc. AAPL through a 400-watt Beats audio system. It also includes App Connect, MirrorLink and MQB architecture. Altogether, the package is meant to appeal to a younger American consumer.

“Jetta has always been a car for the young customers here in the United States,” Diess said.

Volkswagen introduced the Atlas SUV and the Chattanooga-built Passat GT, a $29,000 brainchild of the North American design team with a V6 engine and low sports suspension.

“This is just the beginning of our model offensive,” Diess said. “I won’t rest until Volkswagen has rebuilt its position as a reliable, trustworthy, successful brand in the United States.”

A Sleeker Ram 1500 

Fiat Chrysler Automobile NV FCAU's Ram introduced its new 1500, which is 9-percent more aerodynamic than its predecessor. The vehicle has a raised bed increasing cargo capacity by 10 percent; a lockable external storage compartment with 150 liters of storage space; a 12-inch touchscreen with the fourth-generation Uconnect system; 19 Harman Kardon speakers; and a 305-horsepower, 3.6-liter V6 Pentastar and 385-horsepower, 5.7-liter Hemi V8 with an eight-speed transmission.

The truck is reported to boast a 22-percent increase in maximum payload and 20-percent improvement in towing capacity. 

Meanwhile, the 2019 Ram Rebel has 18-inch wheels and quad and crew cab configurations.

Toyota Adds Alexa 

Toyota Motor Corp (ADR) TM expressed a similar intent to appeal to younger buyers as VW with its 2019 Avalon.

The model has Amazon.com, Inc. AMZN Alexa connectivity; a 0.27 drag coefficient that rivals sports cars; 1,200-watt, 14-speaker surround sound; four exhaust tips with a diffuser in between; a rear spoiler; a 9-inch screen; and 3.5-liter V6 and 2.5-liter, four-cylinder powertrains.

“The 2019 Avalon is the premier Toyota flagship,” said Jack Hollis, president of Toyota North America.

Jeep To Continue Paring Fleets

Considering its growing retail and international sales and 2017’s flat global sales volume, FCA’s Jeep intends to maintain its fleet sales reduced by 60 percent just last year.

“That decision to reduce fleet volume we think is a very important investment in the brand and one that will continue throughout 2018,” Michael Manley, head of the Jeep brand, said. Manley sees growth drivers in the new Wrangler and Cherokee to be launched later this quarter. Over the last four years, the latter model has tripled Jeep’s share of the midsize SUV retail segment, and it still has “plenty more opportunity for future growth.”

The 2019 Cherokee offers 27 cubic feet of storage, Selec-terrain system, a mechanically locking rear differential, three engine options mated to a 9-speed transmission: a 270-horsepower, 2-liter turbocharged, inline-four cylinder engine delivering 295 foot-pounds of torque; a 271-horsepower, 3.2-liter Pentastar V6 engine delivering 239 foot-pounds of torque and 4,500 pounds of towing; 180-horsepower 2.4-liter tigershark multiair engine delivering 170 foot pounds of torque and 30 miles per gallon.

Altogether, the new features are seen to offer improved fuel efficiency and acceleration.

ZF Talks Acquisition Strategy, NVIDIA Partnership

ZF Friedrichshafen AG is meeting rising demand in electric vehicle powertrains and autonomous vehicle technology with general expansion: new facilities, new partnerships with Baidu and NVIDIA Corporation NVDA, and new deployments of capital.

CEO Konstantin Sauer said ZF’s improved financials can support investments in research and development, fixed assets and acquisitions.

“We try to find targets in, for example, software engineering, where we have to speed up,” Sauer said at the Auto Show, noting that startups look particularly attractive.

ZF’s M&A pursuits may exclude chipmakers. Although the firm proved its interest in partnering with the likes of Nvidia, Thomas Wenzel, director of external communications, declined to comment on its potential to more deeply integrate semiconductor manufacturing capabilities.

For now, the firm will leverage collaborations in that realm to support its AV technology development.

“As Nvidia is very strong in artificial intelligence, it’s a very good fit that we came together,” Wenzel told Benzinga.

Notably, it’s not married to Nvidia and will remain open to other partnerships.

“As an automotive company, we generally are open to supply with others,” Wenzel said. “We have to be open, our customers are open.”

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Herbert Diess, chairman of the Volkswagen board, introduces the 2019 Jetta at the North American International Auto Show in Detroit on Monday. Photo by Dustin Blitchok.