What Can a New Chairman Do to Boost Profits at Volkswagen?

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By Trey Thoelcke Published
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The boardroom squabbles at Volkswagen may finally settle down, with Chief Financial Officer Hans Dieter Poetsch now pegged to take up the mantel as chairman of the world’s largest carmaker. Poetsch was picked in part because he was seen as not beholden to ousted former chairman Ferdinand Piech or to Chief Executive Officer Martin Winterkorn, who had clashed over strategy.

With that particular set of troubles behind it, is Volkswagen now ready to do what is necessary to gain sales in the United States, the world’s second largest car market? In August the manufacturer sold 32,332 cars in America, down 8.1% from the same month in 2014.

Sales of the iconic Beetle continued to falter, down 26.8% to 2,127. Sales of the Jetta Sedan, VW’s best-selling model, fell 17.9% to 11,002. VW’s second best-selling model, the Passat, fell 19.4% to 7,409.

In the United States, the difficulty may be that VW only has five models that have any meaningful sales, which puts it up against U.S. and Japanese companies, some of which have much, much larger fleets. The VW share was barely 2% of the cars and light trucks sold through the first seven months of the year.

Management said when it reported August sales that VW would do better next year, but did not say how:

“We are encouraged by the continued strength of the Golf family and confident that success will continue with the model year 2016 vehicles that are equipped with the MIB II infotainment systems and available class leading connectivity features,” said Mark McNabb, chief operating officer, Volkswagen of America.

A lot will depend on how well the former finance chief can work with the CEO to build the company’s footprint in the United States and boost profits.

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About the Author Trey Thoelcke →

Trey has been an editor and author at 24/7 Wall St. for more than a decade, where he has published thousands of articles analyzing corporate earnings, dividend stocks, short interest, insider buying, private equity, and market trends. His comprehensive coverage spans the full spectrum of financial markets, from blue-chip stalwarts to emerging growth companies.

Beyond 24/7 Wall St., Trey has created and edited financial content for Benzinga and AOL's BloggingStocks, contributing additional hundreds of articles to the investment community. He previously oversaw the 24/7 Climate Insights site, managing editorial operations and content strategy, and currently oversees and creates content for My Investing News.

Trey's editorial expertise extends across multiple publishing environments. He served as production editor at Dearborn Financial Publishing and development editor at Kaplan, where he helped shape financial education materials. Earlier in his career, he worked as a writer-producer at SVE. His freelance editing portfolio includes work for prestigious clients such as Sage Publications, Rand McNally, the Institute for Supply Management, the American Library Association, Eggplant Literary Productions, and Spiegel.

Outside of financial journalism, Trey writes fiction and has been an active member of the writing community for years, overseeing a long-running critique group and moderating workshop sessions at regional conventions. He lives with his family in an old house in the Midwest.

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