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VW Routan Reboots Minivan Renaissance

Charles Krome
by Charles Krome
August 6, 2011
3 min. Reading Time
2010 vw routan

2010 vw routan

Just when I was about to give up on my long-running prediction that the U.S. market would see a significant increase in minivan sales—thanks in part to all-new models of the Toyota Sienna, Honda Odyssey and Nissan Quest—I discovered that the revolution hadn't been cancelled after all: In fact, led by the Volkswagen Routan, the minivan mob has become the vehicle of choice for a highly unlikely, but also highly important, group of drivers. According to a recent study put together by the team at TrueCar, the Routan is the vehicle with the highest percentage of Gen X customers in the country, with the Sienna, Odyssey and Quest all joining the Volksvan in the top ten.

A full 66 percent of all Routan buyers are aged 28-45, with Gen X accounting for 60 percent of Quest buyers, 58.9 percent of Odyssey owners and 53.9 percent of Sienna customers. It's an amazing feat for a vehicle that is a thinly redisguised version of the Chrysler Town & Country and is struggling to sell more than a thousand units a month. In the first half of the year, while VW was reaping its highest sales since 2002, the Routan moved just 6,163 units, down 23.8 percent as compared to the first half of 2010.

Still, the vehicle's popularity with Gen X could be an unexpectedly critical factor in the automakers push for higher U.S. sales volumes.

"X" Marks the (Top) Spot for VW

Volkswagen's brisk first-half sales pace—the company's overall volume is up 22.3 percent through June—trails only that of Hyundai and Kia among the mainstream brands, and it offers proof positive that VW's Americanization strategy is striking ye olde chord with customers. Sales of the all-new Volkswagen Jetta, which was redesigned (and repriced) specifically for the U.S. marketplace, jumped ahead by 120.9 percent in June, bumping the model's year-to-date gain to 77.2 percent. At this stage in the game, the Jetta is outselling the rest of VW's lineup combined, both on a monthly basis and for the year to date.

However, that's likely to change once the 2012 VW Passat goes on sale in the short-term future, since the Volkswagen mid-sizer will follow the Jetta's now-proven approach to wooing American customers with a focus on affordable pricing. And this is where the Routan factors into the equation.

The full-size minivan (as opposed to something like a Mazda MAZDA5) has become something of a quintessential American vehicle, and the fact the VW's entry in the segment is already popular with Gen X, combined with the success of the Jetta and expected success of the Passat, suddenly gives Volkswagen a foothold in three vital, traditional sales segments in which it has historically struggled. Because VW also is the younger generation's favorite brand, with 43.3 percent of its customers coming from that golden age bracket, the automaker's position moving forward looks quite good. And that's especially the case when you also consider the boost of interest in diesel products—a Volkswagen specialty—that will no doubt follow the coming launch of the Chevrolet Cruze diesel.


Venza Vidi Vici

Of course, while attracting younger buyers is important for sustainable success, current success requires attracting customers, period. And numerically speaking, the majority of them remain Baby Boomers who are on the far side of their 45th birthday. That's why many mainstream brands are retuning their marketing efforts specifically to target older customers. An excellent example is the new ad campaign for the Toyota Venza, in which Gen X'ers complain about all the fun their parents are having in their cool new crossovers. And I'll also point out that a key attribute in the interior of the 2013 Chevrolet Malibu—as specifically noted by Chevy designers—are the large dials and fonts being used to meet the requirements of older drivers.

Now, when we look at the TrueCar list of top brands for "older" customers, aged 65 and over, I'd say the usual suspects are still having some difficulties. Some 57.5 percent of Buick drivers are over 65, and the marks for Lincoln and Cadillac, at 47.7 percent and 44 percent, respectively, are troubling as well. But once you get past Chrysler, with 36.1 percent of its buyers older than 65, no other company sells even a third of its products to the +65 population cohort. Hyundai and Kia, notable achievers in the minds of most media members, sold 25 percent and 23.5 percent of their vehicles, respectively, to older drivers in 2009 and 2010. Chevrolet, at 32.4 percent, is worth watching as well. Its current popularity is evidenced by the impressive sales of the Cruze, and it also has a toehold with younger buyers. The dated Chevrolet Aveo was the only car except for the BMW M3 to finish in the top ten of the Gen X sales charts, with 48.5 percent of its customers coming from the ranks of younger buyers. That's a number I expect the 2012 Chevrolet Sonic to approach, too.


Today's Takeaway

Volkswagen may finally have hit upon a winning recipe for sales success in the U.S., attracting a wider range of younger customers in some of the country's chief high-volume sales segments, all as a result of embracing a more American-centric approach to the marketplace. But with the buying power of Baby Boomers still driving much of that marketplace, I think the automaker's goal of doubling its U.S. volume by 2013 remains half-baked.



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