Volkswagen Set A Boring Future In Stone When It Rebadged A Forgettable Chrysler

Volkswagen in America isn’t like Volkswagen in Europe. The VeeDubs we get are different than what our European friends get to drive and Volkswagen of America is deeply concerned with having an American identity with European flair. It’s all deeply weird but it did start somewhere. You might not have realized it, but Volkswagen became obsessed with doing things just for America in the late 2000s. Back then, we didn’t get an Atlas or a plus-size Passat, but the Routan, a Chrysler minivan rebadged to look like it came from Europe. It was only the beginning.

Back in 2023, I joined a small group of media at a personal meeting with Volkswagen of America officials that included Pablo Di Si, who until just recently was the CEO of the division. During this meeting, Pablo Di Si and his team explained Volkswagen of America’s product strategy and identity.

They explained that Americans love the European flair and performance of Volkswagens, but don’t like the European quirks that come with a car originally designed for Europe. Giving specific examples, the team noted that Americans loved the original Tiguan, but thought it was a touch too small compared to the compact crossover competition. Thus, when it came time for the second-generation Tiguan, Volkswagen of America’s designers got their chance to fine-tune the long-wheelbase second-generation Tiguan just for Americans.

The Volkswagen of America team also pointed to the Touareg. That SUV launched as the killer app of SUVs. It was fast, it was great off-road, and it towed lots of weight. It was a small-ish SUV that punched above its weight. Unfortunately, Volkswagen’s reps said, most buyers didn’t really care for the off-road gear or the high tow rating. Most buyers just wanted their Tregs to carry their family, but the high price tag and only two rows of seats turned them off.

The Atlas was developed in response. That large crossover, which was developed by American designers for American car buyers first (but also with an eye on China), essentially took the concept of the Touareg and got rid of the off-roading stuff, most of the towing stuff, slashed the price, and cranked up the people-carrying qualities.

Even the Passat got “Americanized.” Much like with Tiguan, Volkswagen of America said that American buyers felt that the Passat was too European. They felt that the seats were too narrow and there wasn’t enough space to spread out. Buyers also felt that the Passat moved too far upmarket. In 2011, Volkswagen of America had its response. The Passat officially split off into two directions.

The European Passat was svelte and premium while the American Passat was now big but more affordable.

During that meeting in 2023, Pablo Di Si addressed questions about Scout and rumors that Volkswagen might bring the Amarok over to the United States. Di Si immediately ended that rumor by telling the group of journalists that Volkswagen of America wouldn’t just import a European model as it did in the early 2000s. Aside from halo cars like the Golf R, Volkswagen of America’s products now had to be uniquely American.

This meant that an Amarok wouldn’t do. If Volkswagen of America were to sell a VW-branded truck, it would have to be designed by Americans for Americans and built by Americans just like the Atlas.

But where did this come from? Why is this ostensibly European brand so obsessed with appearing to be so American? The answer to that question involves DaimlerChrysler and a minivan nobody cares about anymore.

Volkswagen Hits Reset

Back in 2005, Volkswagen underwent a restructuring process. As Industry Week reported in 2006, Volkswagen was making a profit, but the company didn’t think it was making enough profit. From Industry Week:

“In order to boost the wholly unsatisfactory level of profitability of the VW passenger car brand, an extensive restructuring program has been drawn up,” Europe’s biggest carmaker said.

This restructuring process was meant to make Volkswagen a leaner, meaner, money-making machine. In the Industry Week piece, Volkswagen noted that its earnings were just above the breakeven point and that the company was incurring significant losses in certain areas, specifically in cars exported from Europe to America. Then Volkswagen Chairman Bernd Pischetsrieder sought to rid the company of productivity deficits, reorganize its manufacturing, and to make its labor costs more competitive.

To be clear here, Volkswagen wasn’t a sinking ship. It still posted profits, but it wanted even more money. According to Bloomberg, one way Volkswagen sought to reduce its costs was to team up with another automaker for cooperation on projects. Volkswagen seriously considered striking a diesel deal with DaimlerChrysler. At the time, Volkswagen was looking to become known in America as the purveyor of high-performance diesel cars and Daimler looked to be a promising partner. In hindsight, this secret deal, which Bloomberg said was called “Table Mountain,” might have avoided Dieselgate.

Had this deal gone through, Bloomberg reports, Volkswagen would have gained access to Daimler’s BlueTec diesel technology and both companies would have benefited from cross-shareholdings of about 10 percent. However, it was reportedly discovered that adding the BlueTec urea solution to a Volkswagen diesel would have added the cost of 1,000 euros per car and Volkswagen couldn’t figure out how to offset the cost.

Ultimately, Volkswagen canceled the deal and decided to take its own route to make greener high-performance diesel engines. Sadly, it’s pretty well-known how badly that went. However, Bloomberg reports, Volkswagen didn’t leave Table Mountain empty-handed. At first, Volkswagen and Daimler penned a deal for the latter to provide BlueTec to the Volkswagen Passat and Volkswagen Touareg. Volkswagen would later back out of this deal.

One deal that did stick from the talks was a manufacturing agreement. The Mercedes-Benz Ludwigsfelde and Düsseldorf plants that built the Sprinter were to also build Volkswagen Crafter commercial vans. That contract lasted until the end of 2016. Another deal was with Chrysler and it involved allowing Volkswagen to modify the Chrysler Town & Country and have it built alongside the Chrysler minivans.

Volkswagen’s American Minivan

After the talks with DaimlerChrysler ended, Volkswagen was still interested in pumping up its profits. According to the marque’s 2008 annual report, the automaker identified several potential high-growth areas, including the Association of Southeast Asian Nations, China, India, Russia, and the United States. India was seen as one of the most important emerging markets for VW to crack into while at the time, the United States was the largest car market in the world.

However, by Volkswagen’s own admission, it was still a bit of a niche player in America. Keep in mind what I said earlier. Until then, Volkswagen’s strategy involved importing European cars into America. Sure, those cars might have some minor changes for America, but that was it. The Touareg you bought in America was largely similar to the Touareg our European friends got. Volkswagen saw a lot of success with its turbodiesel models, but even these hadn’t quite hit mainstream just yet.

Volkswagen’s response to this was to become hyper-focused on individual markets. What this meant was that instead of importing European-designed and European-built cars, Volkswagen of America was now going to develop cars specifically for Americans and build them locally. To kick this initiative off, Volkswagen began construction of a factory in Chattanooga, Tennessee, and struck a deal with Chrysler to turn the Town & Country into a Volkswagen. In 2008, this plan would be realized in the Volkswagen Routan.

The Volkswagen Routan is sort of silly when you think about it on the surface but gets deeply confusing the more you allow yourself to think about it.

Volkswagen knew how to make vans. One of its most iconic models is the Type 2, a van that became one of the symbols of counterculture in America. Volkswagen then sold models like the Vanagon and the EuroVan. Technically, Volkswagen had absolutely no reason to slap its badge on a Chrysler. However, this goes back to the problem I mentioned earlier. Volkswagen had a bunch of vehicles that were designed by Europeans and built in Europe. Customers wanted a more red, white, and blue experience and something like a EuroVan just couldn’t do that. Volkswagen’s customers were looking for an American-style minivan.

Now, Volkswagen could have made its own minivan. However, this was a product that was destined just for the North American market and VW had that partnership with DaimlerChrysler right there. So, for its first foray into making a U.S.-specific model, Volkswagen of America had its engineers tinker with a Town & Country. That way, it could provide a new product to Americans without spending a ton of money doing it.

According to Car and Driver, the deal was struck between Volkswagen and DaimlerChrysler in 2006. Chrysler and Daimler then got a divorce while Bernhard left VW. The plans for an American minivan survived.

Now, you might think that building a minivan in the mid- to late-2000s was a silly idea. By now, Volkswagen should have been able to see that the future was in SUVs and crossovers, not minivans. However, as WardsAuto writes, 441,932 minivans were sold in America in just the first eight months of 2008 with the Honda Odyssey holding the crown as the best-selling single nameplate. Volkswagen figured it would sell between 45,000 and 50,000 Routans a year, lapping up some decent money in the process. Chrysler would build the vans in Canada for five years. After, Volkswagen was to consider continuing to make minivans, but perhaps in Tennessee.

How Volkswagen planned on doing that was by taking Chrysler’s pedestrian vans and giving them Euro flair, from the press release:

It delivers the best of both worlds: a vehicle that combines European sensibilities in design, fit and finish, and handling characteristics with market relevant features and outstanding value.

The Routan is instantly recognizable as a member of the Volkswagen family, with its stylized front grille and exterior treatments. The interior enhancements create an environment that is visually pleasing, modern, and meticulously detailed. The high quality materials, beautiful textures and rich luxurious colors are combined with exacting tolerances and superb fit and finish. While pleasing and contemporary, the interior also follows the traditional Volkswagen design philosophy that form follows function.

Second row captain’s chairs offer an increased level of luxury and comfort while still providing the convenience of a traditional minivan, with over 32.7 cubic feet available behind the third row seats and a full 83 cubic feet is available behind the second row.

As cool as all of that sounds, Volkswagen didn’t do a whole lot here. Volkswagen’s engineers sharpened up the van’s steering and stiffened the suspension by 15 percent. That’s all they did mechanically. A Routan sources its drivetrain from the Chrysler vans and has the same tuning. Volkswagen didn’t dismiss the possibility of a Routan TDI, but said the engine under the hood would have had to be a V6 to meet the Routan’s mission. Otherwise, Routan buyers had the choice of Chrysler’s 3.8-liter V6 which made 197 HP, or the 4.0-liter V6 good for 251 HP. Later, a 3.6-liter V6 arrived on the scene with 283 HP on deck.

The Crowd Goes Mild

Reportedly, engineers really wanted to make a sort of Town & Country GTI, but that would have defeated the purpose, so they stayed on target with making the Town & Country into an upscale VW. It sounded like Volkswagen achieved what it wanted, too. Here’s a review from The Auto Channel:

As one of those VW lovers of the past I’m mighty disappointed that VW didn’t do something more like the VW Microbus Concept from the 2001 Detroit auto show. It had all the styling queues of the old, incompetent, but loveable, VW vans of old with a wonderful retro chic appearance and updated technology. It looked like it might reach production. But, alas, it didn’t happen. Rather, VW decided to hire Chrysler to make a version of their minivan instead. This one has some VW styling queues and modestly European ride and handling, but it has the proportions and ambiance of a Dodge Caravan or Chrysler Town and Country. And that’s what it is, a Chrysler minivan with VW badges and trim.

It’s certainly an entirely competent, useful and OK-looking vehicle as are the Chrysler donor vehicles. But, it’s not as special as I was hoping a VW would be.

Our test vehicle has a nondescript fabric interior with soft seats. The bolsters look substantial but they just squish out of the way as we slide into the seats. The dash has a conservatively attractive VW style and the shifter for the standard 6-speed automatic transmission juts out of the dash between the center stack and the gauge cluster. It’s a bit of an awkward reach and it has a rather tawdry tactile character, but it was easy to get used to. There are no fewer than 8 – count ‘em 8 – cup holding options for the two front seat occupants – four in the center console, one in each door (for water bottles) and a hidden two-banger in the lower stack. Two-fisted drinkers in the second and third row seats have plenty of receptacles for their libations as well.

Most reviews were similar. The Routan was complimented for its interior improvements, tighter handling, and spiffy style, but no reviewer could forget that under the admirable work of VW’s designers was still a Chrysler. Allegedly, people who weren’t car enthusiasts couldn’t tell that a Grand Caravan and a Routan were basically the same vehicle.

The base model SE trim level was $25,200, which wasn’t too bad. For comparison, a base model 2008 Chrysler Town & Country was $23,415. Yet, America didn’t fall in love with the Routan. Those who wanted vans mostly continued buying Odysseys and Grand Caravans while others switched to the almighty crossover. Routan sales reportedly averaged 11,500 units per year and Volkswagen temporarily halted sales of the Routan in 2012 before killing it for good in 2013. Technically, the Routan was also available in 2014, but only as a fleet model. In the end, just 57,683 Routans were sold to the public.

Volkswagen missed the mark and in hindsight being perfect vision, Volkswagen probably should have made a crossover instead of trying to carve into the dying minivan segment. However, I suppose that point is irrelevant because Volkswagen never gave up trying to build cars just for America and eventually figured out which ones keep the dough rolling in. It’s just a shame that what sells best has also been the least interesting.

Today, tens of thousands of Americans own a Volkswagen that was designed and built by Americans. If you’ve ever wondered where the heck Volkswagen got that idea, now you know where it started. Before the Atlas, Volkswagen of America wanted you to drive a rebadged Chrysler.

(Images: Manufacturers, unless otherwise noted.)