Selling the Passat by the Yard

Ten years ago, Volkswagen attempted to challenge the dominance of the Toyota Camry in the United States with a Passat developed specifically for that market. This is the story of the New Midsize Sedan.

2013 Volkswagen Passat NMS (c) topcarrating.com

For 22 of the past 23 years(1) and over five generations, the Toyota Camry has been the best-selling car in the United States. Over that time, a staggering total of over 9.6 million(2) Camrys were sold, an average of around 417,000 a year. It was a highly consistent seller too: the lowest annual sales total was 308,510 in 2011(3). The Camry successfully weathered the 2008-9 Global Financial Crisis and a simultaneous unintended acceleration controversy that turned out to be caused by ill-fitting floor mats.

If the enduring success of the Camry proves anything, it is that the vast majority of car buyers favour consistency, reliability and value for money far more than subjective or ephemeral qualities such as design aesthetics or dynamic ability. Toyota has honed the Camry into the archetypal US mid-sized sedan that perfectly accommodates the needs of suburban America.

Volkswagen’s competitor in this market, the Passat, had always been something of an also-ran. It was typically a little smaller but a bit more expensive than the Camry, and Volkswagen did not enjoy the premium marque cachet of BMW, Mercedes-Benz, or even its in-house rival, Audi. In the decade to 2010, Volkswagen sold a total of around 530,000 Passats in the US, which was roughly one eighth of the Camry’s sales over that decade.

Volkswagen decided that, rather than persist with a single Passat model to be sold globally, it would develop a unique US market version that would be a little larger than the European Passat, but subtly re-engineered to make it cheaper to manufacture and more competitive against its Japanese nemesis and US domestic mid-sized sedans.

The new model programme was christened NMS, which stood for New Midsize Sedan. It was co-developed with Volkswagen’s Chinese joint-venture business, SIAC-Volkswagen Automotive. The Chinese operation also had an appetite for a large saloon to replace(4) the 1999 LWB version of the B5 Passat, better known in Europe as the Škoda Superb Mk1.

2011 Volkswagen Passat NMS (c) idnes.cz

The NMS Passat was designed in the contemporary Volkswagen style under group design chief Walter de Silva and head of Volkswagen design, Klaus Bischoff. It sat on a wheelbase 94mm (3¾”) longer than the European Passat and was 105mm (4¼”) longer and just 14mm (½”) wider overall. It was most immediately distinguishable from the 2010 B7 Passat (which was a heavy facelift of the 2005 B6 model) by its adoption of a six-light DLO configuration in place of the latter’s ‘Hofmeister kink’ rear door frame.

The NMS Passat was launched at the Detroit Motor Show in January 2011. It was presented by Jonathan Browning, Volkswagen of America’s president, as a car designed for and built by Americans at Volkswagen’s newly opened plant in Chattanooga, Tennessee. It was the central plank in the company’s plan to move firmly into the mainstream US market and achieve annual North American sales of 800,000 by 2018. US prices were $20,590 for the 2.5 litre inline five and $32,950 for the 3.6 litre VR6 in top of the range SEL trim. This represented a useful reduction over the superseded model. Trim levels were more generously equipped than previously and the options list much reduced and simplified.

A key element in the new Passat’s competitive pricing was US parts sourcing and assembly. Although engines would be imported from Mexico or Germany, over 90% of parts would be sourced domestically. Volkswagen claimed that this would be a higher percentage than for even some domestic US models and would insulate the Passat from adverse exchange rate fluctuations inflating its pricing.

Motor Trend, the US automotive magazine, road-tested the new Passat in May 2011. The test car was equipped with a 2.0 litre 140bhp 236lb/ft TDI diesel engine and a six-speed dual-clutch transmission. The reviewer was impressed with the power and torque of the engine, and how refined it was in this installation. The cabin was commendably free of mechanical and wind noise, with only an intrusive tyre roar spoiling the sense of refinement. Although no sports car, the Passat steered and handled accurately and safely. The reviewer later drove the base 2.5 litre petrol-engined model with a five-speed torque-converter automatic transmission and found it to be lazier and a merely adequate performer.

The reviewer described both the interior and exterior as attractive, if rather conservative, but perhaps likely to become dated less quickly than some of the Passat’s more obviously fashionable rivals. If so, that might have been just as well because, apart from a questionable facelift in 2015 for the 2016 model year, the Passat NMS received little attention over almost a decade on sale.

2013 Volkswagen Passat NMS Interior (c) en.wheelsage.org

At launch, Volkswagen announced that the company was forecasting US Passat sales of 100,000 for 2012, its first full year on the market. This forecast was comfortably exceeded, and the actual figure was 117,023. Unfortunately, that would prove to be the high-water mark: sales declined from that point onward and just 14,123 were sold in 2019. Total sales over the nine years to end-2019 were 613,614 which averages just 68,179 annually.

Such has been the decline in Passat NMS, and mid-sized sedan sales generally in the US that, instead of an all-new model underpinned by Volkswagen’s MBQ platform, the Passat NMS was facelifted again in 2019 for the 2020 model year. As for that target of 800,000 North American sales in 2018, Volkswagen missed it by a large margin: the actual total was 354,064, a market share of just over 2%.

2019 Volkswagen Passat NMS (c) karenradleyvw.com

China proved to be a much more successful territory for the Passat NMS, however. Total sales over the nine years to end-2019 were 1,792,206 which is an annual average of 199,134. Consequently, an all-new Chinese-market Passat based on the MBQ platform was launched in October 2018. This is sold alongside an LWB version of the European Passat B8 and no longer bears any relation to the Passat NMS.

Despite being a competent and competitive car, did the Passat NMS arrive on the US market a decade too late and was it hobbled by the general move away from mid-sized sedans to SUVs? Possibly, but it is worth noting that the Camry still achieved US sales of 336,978 in 2019, demonstrating that, for a certain conservative buyer demographic, the conventional sedan still has its place.

 

(1) In 2001 the Honda Accord borrowed the Camry’s crown during a model changeover that temporarily restricted supplies of the new Toyota model.
(2) All sales data from www.carsalesbase.com.
(3) Another model changeover year.
(4) Despite being similar in size, the Passat NMS did not, after all, replace the Skoda Superb based version, which was sold alongside it until 2015 in China, having been restyled and renamed Passat Lingyu in 2005.

Author: Daniel O'Callaghan

Shut-line obsessive...Hates rudeness, loves biscuits.

25 thoughts on “Selling the Passat by the Yard”

  1. Hello Daniel, thank you very much for the article. I enjoy thinking about what kind of car I would buy if I lived in America and the answer was either VW Passat, Subaru Levorg or Mazda 6.
    The various Toyota Camry, Nissan Altima and Honda Accord are too American in design for me.
    I’d like to know how the other VWs sell in America, whether they stick to the plan or not.

    1. Good morning Marco. Here are VW’s US sales numbers for the past decade:

      Year: sales: change y/y % mkt. share %

      2010 256,830 +20.32% 2.22%
      2011 324,402 +26.31 % 2.54%
      2012 438,134 +35.06% 3.02%
      2013 407,704 -6.95% 2.62%
      2014 366,970 -9.99% 2.22%
      2015 349,440 -4.78% 2.00%
      2016 322,948 -0.58% 1.84%
      2017 339,676 + 5.18% 1.97%
      2018 354,064 +4.24% 2.04%
      2019 363,322 +2.61% 2.13%
      2020 326,911 -10.02% 2.24%

      In market share terms, the company has ended up pretty much where it started at 2.24%.

    2. If you live in the US you may as well drive a car in tune with the conditions. If Buick still make a saloon, I´ll opt for that. The Toyota Avalon would be another contender.

    3. Daniel, that original NMS Passat 2.5 litre engine was an inline 5 cylinder, not a four, and was taken from the then current Jetta and Golf. It had 170 bhp and was pretty lively with a manual box in those smaller cars; the automatic not so much. Its bones remain in the Audi RS3 and TT RS to this day.

      Other publications (besides MT which I hardly ever bother with) here in North America have blown warm and cold on the NMS Passat over the years. Most have desperately tried to say something nice about it, which usually boils down to: “It has a helluva big back seat!” Ride has been described as underdamped and soft. The current standard engine is the execrable “Budack” 174bhp turbo four which also blights the Tiguan and Audi A3 here. The optional stone-age VR6, now years beyond its best sell-by date, is with us no more. I believe Mr Herriott rented a Tiguan perhaps 18 months ago, and discovered the Budack nonsense by happenstance when he wondered why it took ages to get back up to speed on the autobahn after an enforced slowdown. It doesn’t like to go beyond 4500 rpm, and is coarse even at that lowly speed. It is supposedly an economy champ, but no one has noticed. It could be best described as useless, and not in the least comparable to engines in Honda Accord, Toyota Camry or Mazda6 (which I bought in turbo form 18 months ago), nor has the vehicle itself been updated in any meaningful way since introduction. It comfortably ranks last in class, because the Hyundai Sonata, Kia Optima and Nissan Altima are also better, while the Mondeo has always slayed it, but that’s done now as well.

      VW has basically given up on the Passat here, because it’s an all-singing all-dancing EV Technology Company now, don’t you know, with novice software writers still on the learning curve, and featuring white vacuum-formed plastic interiors for that modern “look”, which the Chevrolet Volt and Toyota Prius beat them to years ago. The VW Arteon is available at a very high price as an upscale “Passat” with a decent 268 hp turbo four, which so far as I’m aware is the same 2 litre EA888 engine as the Budack, but with a cylinder head that actually works, as in the GTI and so on. The Arteon is so rare, only the dealer has spotted them, sitting forlornly in the back lot gathering dust. No reasonable offer refused.

      Buick gave up on sedans about three years ago, Richard. Now they flog 3 cylinder crossover wonders called Encore GNX made by Daewoo, er, that’s GM South Korea. It’s what the Mokka would have become if PSA hadn’t bought Opel. And Buick has three or so other two box high-stepping wonders of no particular merit on offer. A complete yawn. But Alexa can start them remotely from anywhere in the world, or lock their doors too if you forgot to when you went on a Covid quarantine tour. So there’s that.

    4. “…because [VW] it’s an all-singing all-dancing EV Technology Company now” made me laugh.
      Unfortunately, the other corporations do the same dances to the same music, and that is (unfortunately) neither funny nor is it original.
      The (US) Passat is actually a nice-looking saloon – well, VW probably messed it up (again) with the wrong engines, I can’t judge. You have to put the car in context, it was aimed as a (VW) alternative to the Camry. Something like that can and must go wrong from the start.
      Why does a company always have to look at what others are doing? Why not just do what you think is right or better? Oh yes, market research and the music currently being played, I forgot.

    5. Bill: I am having one of those horrible time-passing moments when you mention the demise of Buick saloons. My memory of looking at their website and spying a Lacrosse or something is old, like the litre of milk in the back of the fridge from two Tuesdays ago. Oh, my.
      I suppose I would have to buy a second hand Buick.
      Hey! There´s always Oldsmobile.

      It was Christopher who had the car rental escapade, I have to say. It´s been about four years since I rented a car. We inherited a Peugeot 406 from an in-law. It was free and has, now passed its first state road test with us. It did very well (which in Denmark means paying a mere thousand euros for fixing the few faults it had). I put on new all-season tyres, fixed the handbrake (a perennial on this car), changed the oil and did something with the exhaust tubes and the brakes. I vacuumed it today to put a seal on the event. I think it might last another two years. It´s 23 now and the black paint hides the rust quite well. Sometimes I look at the car and try to like its appearance. A Carina E from the same period is more compelling. It´s great inside with super back seats -and as dull as the outside. No matter, it´s a survivor.

    6. I can´t figure out why the Arteon is not more popular. It is by any measurable standard a very good looking machine. It´s not madly expensive and, at the very least, as useless and any other vehicle costing the same but which sells in greater quantities. TG gives it 7/10 marks.

    7. Richard, simple reason: the VW Arteon is poor-man-A5, an the front looks like a Toyota on the way to A.M.G. (Unfortunately, the A.M.G-joke only works in German.)
      The Passat (any Passat), on the other hand, is more boring and mundane, but also more honest.
      And leave me alone with 4-door coupés, all of them are just cheap copies of the Rover P5

    8. If you mean the Arteon is a cheaper version of the A5 then it still doesn´t compute. The A5 is nice. The Arteon is nice. Neither is very cheap. But I am not a demographic – I can only speak for myself and I like the car. VW was fooled by the focus groups, evidently. I don´t see the Arteon as a coupe – it has too many doors. Still, it´s not useless, it looks quite smart and is not too expensive or too cheap. Jaguar customers might like it? Or Alfa Romeo customers? Again, it is astonishing how merely not being the very, very best of being anything less than totally obvious is a career killer in the car showroom. Unless your name is Baleno in which case lots of people will overlook its oddness and plain not-being-a-Polo-ness and sign on the dotted.

    9. It’s been interesting looking at the leasing deals available when examining the Arteon.

      The Arteon costs about the same as an Audi A5 to lease, but (arguably) does not have the prestige or quite the quality, especially inside. An A5 / A4 / BMW is more easily understood and has a better image in the relatively conservative business market.

      A Passat, which is just as good, is considerably cheaper, so you could get one of those and have a top spec one for the same money (probably what I would do, in that position).

      It’s astonishing to compare cars’ leasing costs – a really nicely-specified Golf is £20 per month more than an up! (exclamation mark coming in handy).

      American car? New, a Dodge Challenger, please. Or a Lincoln SUV.

      For fun, a ‘42 De Soto and a ‘67 Mercury Cougar.

      https://www.dodge.com/challenger/gallery.html

    10. Some people are tone deaf or are colour-blind. My problem is I can´t detect “prestige” other than to have a vague inkling some people consider it (“what do I guess other people will make of this car”?”
      “The Arteon costs about the same as an Audi A5 to lease, but (arguably) does not have the prestige or quite the quality, especially inside. An A5 / A4 / BMW is more easily understood and has a better image in the relatively conservative business market.” Martin Amis noted once that anytime one can write “arguably” one can also write “arguably not” too. Where might the quality difference lie between the two cars? That´s a factual question not a rhetorical one.

      I should point out, I am only berating myself for not having the smallest inkling that if Jones turned up in an Arteon anyone would think less of her than if she turned up in an A5. Both are nice cars. Evidently some consumers can wavelengths of prestige my own sensors can´t detect just like bats can hear ultrasonic noises.

    11. Quite right, Richard. In my defence, I stuck the ‘arguably’ in as a courtesy word; there’s always the possibility that stating categorically that an Audi is ‘better quality’ than a Volkswagen will elicit the response ‘How dare you? / says who?’.

      The materials and weights in an Audi, compared with an equivalent Volkswagen model are better. Plastics are softer and have a more convincing sheen, switches operate ever so slightly more smoothly / positively. It doesn’t sway me, personally – Volkswagen quality is very good. However, when I’ve been in Audis, even an A1, it feels as though someone has been round with a screwdriver and made sure everything has been firmly fixed.

      An analogy – a reviewer who was looking at the latest Astra said it was functionally fine, just that compared with, say, a Golf, it’s baggier – like it’s already done 80,000 miles. The difference between Volkswagen and Audi isn’t that big, but it’s detectable.

      I’m sure if one turned up in an Arteon, it’d be seen as a good choice; however, many people’s first question, either spoken or thought, would be ‘Why did you choose this over a…’ and that’s a valid question. A friend leased an A4 a while back, and I teased him about his boring choice. When I actually sat in it, it was beautiful, predictable choice or not.

    12. Good morning Charles and Richard. I’ve been reading your conversation regarding the Arteon with interest as, like Richard, I have considerable difficulty distinguishing levels of ‘premiumness’ in modern cars, in particular VW Group products.

      Luxury is easy: an acquaintance of mine has a Jaguar X300 XJ and it is properly luxurious inside in the traditional ‘wood and leather’ manner and still looks good after twenty or so years, even if its build quality is some way behind the current VW Polo.

      Premium, I don’t really get. My brother-in-law has a Škoda Kodiaq, which replaced a previous generation Superb estate, and both are beautifully finished outside, with tight, consistent panel gaps and perfect metallic silver paintwork. Inside, the plastic mouldings are solid, soft-touch wherever necessary, and all the controls operate smoothly and feel really well engineered. All this from a car that is supposedly at the bottom of the VW Group hierarchy. If I had a criticism, and it’s a very minor one, the chrome accents on the dashboard are a little bit ‘shiny’, although their use is pretty restrained.

      At the top of the VW Group hierarchy sits Audi, and I would describe their interiors in very similar terms. I don’t doubt that there are marginal differences, but the basic architecture and construction is very similar. Take the branding away, and I doubt that many people would be able to tell the difference. Audi is premium almost entirely because their marketing tells us so. I can absolutely see the appeal of sitting in and driving an X300 XJ. The extra appeal of an Audi over a Škoda interior largely escapes me.

      If the Arteon is perceived as lower ranking in terms of ‘premiumness’, that’s down to marketing, not reality, as far as I can see.

  2. VW’s biggest sellers in the US and their 2020 sales figures are as follows:

    Tiguan: 100,687
    Jetta: 82,662
    Atlas: 58,293
    Atlas Cross Sport: 29,069

    Passat sales recovered somewhat in 2020 at 22,964 but are still a small fraction of what VW hoped would be achieved by its US market specific model.

    1. I looked up the Atlas, as I was unfamiliar with it. “Mid-size” apparently, though larger than the Audi Q7 (ye gods). Still, it would need to be big to accommodate the 17 (yes, seventeen) cup holders. 2.43 cup holders per seat.

    2. Hi Andy. The Atlas is a rather more successful US market focused VW than the NMS Passat. The formula is similar: bigger, but a bit cheaper than a Touareg. It’s wheelbase is 86mm (3 1/2″) longer and it is 162mm (6 1/2″) longer overall, so a bit of a beast. The Cross Sport is a coupé version and both are also sold in China as the Teramont.

      In what parallel universe could you possibly need seventeen cup-holders?!?

  3. I never realised VW did a USA only Passat – you live and learn, thanks, Daniel.

    So I briefly looked at Toyota and Wolfsburg American sites. Horses for courses really between the two cars, similar packages, colours, prices, etc but Toyota in Camry form must generate a cosier glow to sell that many than the rather bland NMS. Should I be in the market for a US only sedan, I’d be tempted by the Hyundai Elantra instead. Though, like Richard, I’d prefer a ‘90’s Buick .

    1. Andrew: there´s the Kia K5 and the Hyundai Sonata and, if you want full on Buick, try the Genesis G70, G80 or G90. These are pretty much doing what Buick used to do. So, how is it Toyata, Kia, Hyundai and Genesis and Honda/Acura can make nice saloons and Buick can´t? Chevrolet make the dirt-cheap Malibu if the G80 is a bit rich.
      I think my money´s now on the Genesis cars. They look really plush and lavish.
      In contrast, Cadillac has circled the pan. The CT5 is a horror, looking like they were aping the Honda Civic. The Art & Science theme has been replaced by the Over Design theme.

  4. Good afternoon all. That’s an interesting question, what car would you buy if you lived in the USA. It would have to be American for me. Traditional sedans are a fast vanishing breed. I might be tempted by a Ford Bronco (the ‘proper’ one, not the Sport) or a Chevrolet Camaro convertible.

    1. I’ve lived in North America (Canada) for 11 years and, despite temptations, of the 40 or so cars I’ve gone through here only one has been “domestic” – a “XJ” Jeep Cherokee (or rather, two of them). Despite the novelty charms of the myriad land-yachts available for pennies I still struggle to make one fit into my day-to-day life.

      Further to this, having been here since 2010 it had never occurred to me that the Passat one can buy here is not the Passat I could have bought in the UK. Everyday’s a school day, as they say…

    1. USA, well, there’s a lot more landscape between Monument Valley and downtown Manhattan.
      For the former, I would definitely follow your suggestion. For the latter, I’d rather take a taxi – but because of mask constraints, I’d rather would go for a walk.

  5. Hi Daniel, I think you did correctly state that the 2.5 litre was an in-line five in your article.

    1. Hi Simon. Thank you, but I must admit that I corrected the error after Bill pointed it out!

      Actually, the predictive keyboard program I use is a mixed blessing. It is helpful when your typing is as haphazard as mine, but when you’ve typed “inline-four” many times, then type “inline-five”, the program assumes you’ve made an error and sneakily changes it without you noticing. (That’s my excuse and I’m sticking to it!)

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