Will Clean Diesel Refuel the Coffers of Volkswagen America? (VLKAY, CDTI)

Volkswagen of America VLKAY is generating buzz over its recent debut of the all-new Passat equipped with TDI clean diesel technology at the Detroit Auto Show on Monday. The German based automaker unveiled the new model of its popular sedan three days after Volkswagen Canada announced record 2010 sales for cars equipped with clean diesel technology. In a press release on January 4th, Volkswagen Canada reported that its yearly total of 45,388 surpassed the previous sales record from 2001 by over 2,000 units. VW Canada credited the “tremendous performance” of 2011 Jetta with clean diesel for the surge in sales. In December, 2,150 Jettas were sold, marking an increase of 190 percent from the year before. Investors are wondering if Volkswagen's new Passat will repeat the success of its Canadian counterpart. Volkswagen rolled out its American Passat on January 10, 2011. Volkswagen models equipped with TDI Clean Diesel Technology have shown impressive strength, as these models now make up 20% of the total volume of all new colkswagen sales. Moreover, this technology is now available on the new Jetta, Golf, and the all-new Touareg Sport Utility. Interestingly, Clean Diesel Technologies CDTI is about 5% higher than yesterday's close as investors speculate that contracts might be forthcoming related to stories of Volkswagen and the clean diesel trend in automotive manufacturing. Nevertheless, CDTI's 500% return this year and its low float might deter more conservative investors.