After the hippie bus and the Beetle, VW is looking at America again

As Volkswagen looks to revive the Scout brand in the United States, CEO Herbert Diess has shed light on the decision, saying it enables the German auto giant to “become much more American.”

Last Wednesday, VW announced plans to relaunch the Scout as an all-electric pickup and “rugged” SUV, with prototypes due in 2023 and production slated to begin in 2026.

In the same announcement, the company stated that the vehicles would be “designed, engineered and built in the USA for American customers”.

“The United States is our biggest growth opportunity,” said Diess, who spoke with CNBC’s Annette Weisbach last week.

He went on to explain why the automaker was targeting the fiercely competitive US market.

“We are still very niche, very small, with a market share of about 4%. [in the country]”, – he said. – We want to get up to 10% market share by the end of this decade.”

Diess emphasized that the firm had momentum, was profitable, and “really did a good job with electric vehicles.”

These vehicles include the all-electric ID Buzz, which is inspired by the T1 minibus or “hippie” van. The European versions of the ID Buzz will go on sale this year, with the US model starting in 2024.

This 1970 image shows people driving a version of the Volkswagen Microbus at an Oregon rock festival.

Brian Payne/Pix | Michael Oks Archives | Getty Images

VW hopes the introduction of the Scout and ID Buzz will continue the tradition of introducing iconic models to the US market. Over the years these have included the Beetle and various versions of the Microbus such as the one pictured above.

Scout’s history dates back to the 1960s when International Harvester – originally an agricultural company now known as Navistar International Corporation – began development. Today, Navistar is part of the Traton Group, a subsidiary of the Volkswagen Group.

The Scout was discontinued in 1980, but Volkswagen’s decision to relaunch it and Diess’s comments provide some clues as to its strategy for the future.

“If we really want to be relevant in America, we need to look at other segments,” he said. “And pickups, big SUVs, are very, very popular in America.”

Diss went on to describe Scout as “the favorite brand in the United States. So this is a good opportunity for us to become much more American.”

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When asked whether the Scout pickup would be exclusively for the US market, he answered evasively. “I wouldn’t say ‘totally dedicated’, but above all…it’s an American product.”

“It will be an American product for American customers, designed for the American environment. Will it be sold outside the country? Perhaps this will be determined later, ”Deiss added.

This year, VW plans to create a separate independent company to design, engineer and manufacture Scout pickups and SUVs for the US market.

Volkswagen’s focus on electric vehicles is a far cry from the dieselgate scandal that rocked it in the 2010s. Today, its electrification plans put it in direct competition with long-established automakers like GM and Ford, as well as relative newcomers like Tesla.

Speaking about the company’s overall prospects in the US, Diess was optimistic.

“We are ramping up capacity in the United States…later this year, around August, production of the ID 4 will begin at our facilities in Chattanooga,” he said.

“We have programs for Audi and Porsche to increase their market share, and… we will see a few more products, electric products, that will be made in America and for America.”

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