Volkswagen stands behind spec offering

VOLKSWAGEN Australia says there is a difference between a car being ‘cheap’ and a car offering ‘great value’, with new models from rival brands offering cars that seem to make consumers think they are getting both.

Indeed, the German importer – which has struggled for sales in 2024 ahead of a massive 12 months of model additions and renewals – insists it will not be drawn into a pricing frenzy at the base level for its affordable models.

The assertion came at the launch of the facelifted T-Cross compact SUV, which comprises three grades – and unlike the last version, there are no option boxes to tick this time around.

VW says that will make it easier for customers to decide on which grade works for them – the entry-level $34,990 drive-away Life grade, the mid-spec Style at $39,990 drive-away, or the top-spec R-Line version, which is $43,990 drive-away.

Those prices represent a bit of a hike on the list price equation of the previous model, but not when the options boxes were ticked.

Volkswagen Australia general manager of corporate communications Paul Pottinger said that the brand is not just increasing prices, it is increasing the value ratio significantly – and this more richly specified range, with “thousands of dollars” of extra value added across the line-up, is a response to buyer feedback.

“Obviously, we drop a lot of dough asking customers what they want, we’re customer focused,” he said.

“And they’ll say, ‘this is what we want, we’d like it in the base model grade – so we’ve made that available.

“It's almost kind of counterintuitive for us, because like in other SUVs, you see our customers going for the top grades – Tiguan is a classic example, like 50 per cent of our Tiguan sales at any one time are 162TSI, most of which are R-Line.”

The Tiguan range starts at $43,990 +ORCs, yet most buyers are spending at least $57,090 +ORCs for the 162TSI Elegance or $60,590 +ORCs for the 162TSI R-Line, and there’s the even-more-premium Tiguan R, at $73,790 +ORCs, which is the most popular R model sold by the brand in Australia.

“But here, because this is an entry car, and we think it is a really good value entry car, the majority of the customers are going to be at the entry grade,” added Mr Pottinger.

Volkswagen Australia product manager Arjun Nidigallu said making the range “really simple and straightforward” was important for buyers.

“As you may remember with the outgoing model, we offered two grades, each with two optional packs with a total of eight possible combinations that you could get,” he continued.

“We’ve dramatically reduced the complexity of our lineup, removing all the options and offering those components as standard in our lineup, and now it's come down to three total combinations down from the eight in the previous model.”

Mr Pottinger stated that, rather than rolling the arm over for this update, the brand decided to restructure its offering based on what customers wanted.

“It is ultra-competitive out there right now. We all know that, and so it’s incumbent upon us to make sure that we do that work with the customers and get all that kit into our cars. The midlife is a real opportunity for customer and brand alike,” he said.

“When you talk about the value of this car and the price point of this car, and maybe it is comparable, and maybe there are some other new entrants into the market, and other competitors which are, on paper, slightly cheaper, but I don’t think many of them were engineered to have – for example – windshield wipers at work for 200 kilometres per hour on the Autobahn in the northern winter.

“And we might not need that, but I’m pretty glad it’s there. I think that should be part of it under consideration as well.”

The new T-Cross from VW comes with a 1.0-litre three-cylinder turbo-petrol engine across all variants, with the engine producing 85kW and 200Nm. It employs a seven-speed dual-clutch auto (DSG) and is front-wheel drive only.

Fuel consumption is rated at 5.6 litres per 100km, and emissions at 126g/km CO2. It has a 40-litre fuel tank.

Volkswagen backs the T-Cross and all of its models with a five-year/unlimited-kilometre warranty, roadside assist that tops up with each service, and maintenance intervals are every 12 months/15,000km.

There is a prepaid service plan available for three years/45,000km ($1500) or five years/75,000km ($2850), or you can pay-as-you-go for maintenance under the capped-price plan.

The T-Cross plays alongside some big sellers, and until stock started to dry up this year, it was performing relatively well in the light SUV segment.

In 2023, the smallest VW SUV amassed 5762 sales, ranking it fifth in the segment behind the Hyundai Venue (6152), Toyota Yaris Cross (6514), Kia Stonic (6983) and the ageing Mazda CX-3 (15,776).