VW Confirms New SUV for American Market

Volkswagen AG CEO Martin Winterkorn says the company will introduce a new seven-passenger midsize SUV in the U.S. in 2016.

The vehicle will be a production version of the CrossBlue concept VW unveiled at year ago at the Detroit auto show. The company has not confirmed a Reuters report last week that the new model will be built at VW's two-year-old factory in Chattanooga, Tenn.

The company's huge assembly complex in Puebla, Mexico, also has been under consideration for the SUV. That facility will begin making VW's seventh-generation Golf hatchback on Tuesday. The car, which debuted in Europe last year, will hit U.S. dealer showrooms this summer.

The Golf launch will mark the first time that model has been made in North America since the first generation version, which debuted as the Rabbit, went out of production in New Stanton, Pa., in 1988.

Winterkorn says the new SUV is part of a five-year, $7 billion expansion in North America aimed at helping VW achieve its goal of selling 1 million Audi and VW brand vehicles per year in the region.

The investment total includes the $1.2 billion plant Audi plans to open in San Jose Chiapa, Mexico, in 2016 to make small luxury crossover vehicles.