Despite ongoing growth in the small SUV market locally, Volkswagen Australia has made the difficult call to sideline the brand’s T-Roc compact SUV, despite a focus on expanding its crossover range.
Volkswagen Australia managing director Michael Bartsch told media at the launch of the flagship Arteon hatch this week that decision was tough given the growing popularity of compact SUVs, but over the longer term the it should prove to be the right call.
“I think it needs to be said that we need to temper our expectations on the T-Roc,” Bartsch told TMR. “Right now the decision has just been made, after much debate and much consideration, to take us off the short-term list for T-Roc. They simply can’t get the production up to where we need it for here.”
Estimates for the T-Roc’s arrival still had it at least two years away from an Austraian introduction. Despite that, Bartsch explained he doesn’t want to experience the same kinds of supply constraints that are impacting the larger Tiguan, which he said now has a six month waiting list for some models.
The setback doesn’t completely take T-Roc of Australia's radar though with Bartsch suggesting the decision could come under review in the longer term.
“We need to just park it for a year and come back and reexamine it and focus on getting the T-Cross out,” he said.
The T-Cross, a slightly smaller and more mainstream offering compared to the more stylish and higher positioned T-Roc, is locked in for a local launch.
“It’s no secret we’re on the edge of our seat waiting for the T-Cross to come in 2019,” Bartsch said.
Volkswagen Australia general manager of marketing, Ben Wilks, revealed the decision to drop the T-Roc could benefit the T-Cross.
“There’s a good opportunity for us focusing on the T-Cross,” Wilks said. “Volkswagen’s had a very strong value proposition… We think we can manage that value proposition better with the T-Cross than we can with the T-Roc.”
“It’s coming a little bit later but if focus on that model we think that’s going to be the right car for Australia.”
But the T-Cross and T-Roc aren’t the only new SUVs on Volkswagen’s agenda. The new generation Touareg is set to launch in 2018 and Bartsch compared it to the Arteon, saying it will be the flagship for the brand’s SUV range. Based on the same underpinnings as the Audi Q7 and Porsche Cayenne, it is expected to push further upmarket in terms of its style and technology.
Despite the premium connection Bartsch ruled out a strategic shift for the Touareg into the premium sector similar to the positioning of the Arteon; which is openly designed to compete with rivals from Mercedes-Benz, BMW and Audi.
The local boss does want more SUVs though to sit alongside the Touareg.
“I think Touareg sits nicely where it is right now,” he said. “The really big job the team has is to look where we have opportunities to participate in more of the SUV segments.”
One of the segments Volkswagen would like to enter is the seven-seat large SUV class dominated by the likes of Toyota Kluger and Mazda CX-9. In overseas markets the brand’s full-size Atlas fills that role, however a lack of right hand drive availability rules it out.
Volkswagen Australia’s chances of convincing head office to offer it in right hand drive are made more difficult thanks to other RHD markets including South Africa and the UK showing little interest in the larger vehicle.
“I’ve seen that car in the US and it would work perfectly in Australia,” he said.
Instead VW Australia will have to rely on the forthcoming Tiguan Allspace to act as its only seven-seat SUV. While too small to be a serious rival to the Kluger and CX-9, Bartsch is confident that it can be a success in the local market. He believes there is an opportunity for the Allspace to appeal as a part-time seven-seater that offers more practicality to families than the current five-seat Tiguan.
“We should be able to do 15,000 cars, in my opinion, if we do that car right,” he claimed.
“The world’s a pretty dynamic place and you never know what the competition is doing but that is a car, in my opinion, under the right circumstances that’s do-able.”
The Tiguan Allspace is due to launch locally in the first half of 2018.