CNN
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When Volkswagen determined to relaunch the Scout SUV model it took a really uncommon step. It created a brand new subsidiary firm to design, construct and promote autos focused, nearly fully, at a single market: the US.
Its standing as a subsidiary of Volkswagen Group, much like Audi and Porsche, offers some indication of simply how essential this mission is to VW. The revived and revamped Scout Motors will introduce its new model of all-electric off-road-capable SUVs, type of like Rivian.
However VW is banking on one thing Rivian doesn’t have, a backstory. An avid fanbase in America fondly remembers Scout. Right here, it was one of many pioneering SUV manufacturers, and its authentic fashions are collectibles at the moment.
So, simply because it’s doing with the Volkswagen ID. Buzz, an electrical replace of the traditional hippie bus, VW is relating nostalgia to achieve a brand new era of automobile patrons. This time, although, it’s an American factor. Germans wouldn’t perceive. Or so that you would possibly assume.
“We actually do perceive the American spirit however not solely that we additionally actively contribute to it,” Volkswagen Group chief govt Oliver Blume stated whereas discussing the corporate’s international earnings Wednesday. “What’s slightly promising is the revival of the Scout cult model. That is how we’re laying the muse for an electrical SUV and pickup model within the largest and most worthwhile US phase.”
Nonetheless, Scout might have been launched as merely a sub-brand, only one or two fashions, underneath the favored VW model. As an alternative, it’s breaking out fully by itself.
“It’s a distinctive choice to make however not one which appears too loopy to me, particularly for Volkswagen given that it’s in a phase that they aren’t historically sturdy in or well-known for – and given the model recognition for Scout in the US from fanatics,” stated Erin Keating, an trade analyst with Cox Automotive,
However whereas VW might have purchased the identify, the brand new firm’s chief govt is already knocking opponents as unoriginal.
“Mainly, the whole SUV market is an imitation of Scout, not solely what the product is however the identify,” stated Scott Keogh, chief govt of Scout. “So, Trailblazer, Blazer, Discovery, 4Runner and Explorer, simply maintain going. They principally took the Scout identify and did a synonym search and spit it out.”
The unique Scout SUVs and vehicles had been made by Worldwide Harvester within the Nineteen Sixties and ’70s. They had been the industrial truck maker’s foray into the passenger car market. VW got here to personal the trademark for the defunct model in 2021 when it bought Navistar, a successor firm to Worldwide Harvester. A 12 months later, VW announced Scout’s planned rebirth.
The VW Group has a 5% market share for car gross sales within the US with the mainstream Volkswagen model accounting for rather less than half of that. The remaining comes from Audi, Porsche, Bentley and a tiny bit from Lamborghini. Volkswagen Group executives ceaselessly check with the North American market as a supply of “untapped potential.”
Scout Motors might be a key a part of tapping a few of that potential, in response to Dave Mondragon, a former Ford govt who’s now an trade analyst with S&P World Mobility. However VW might want to make some tough steps earlier than it could get there.
“First, entice new clients to your model who wouldn’t have shopped the model earlier than. Sellers like that,” he stated in a weblog post on S&P’s website. “Second, it’s about retaining clients already in your fold, however [who] might migrate out since you don’t have most of these autos.”
It’s nonetheless not clear precisely how Scout’s autos might be offered within the US. Scout Motors hasn’t introduced, but, whether or not they’ll be offered by means of VW sellers or by means of a completely separate supplier community and even simply direct to the client, the way in which startups comparable to Rivian and Tesla do.
Scout CEO Keogh, who used to go Volkswagen North America, insists that Scout, too, is a startup regardless of being owned by one of many world’s largest automakers. This standing, he stated, offers Scout the flexibleness to do no matter is required.
“Being a startup within the place we’re in, we problem ourselves on pivots nearly each day,” Keogh stated. “And we’ve got the power, proper? As a result of we’re a startup and lean. We don’t have all of those mounted positions.”
Being a separate subsidiary additionally opens up some choices for VW to share the monetary burden and the potential dangers.
“If we wish to pursue a strategic investor, if we wish to method the capital markets, if we wish to go to an IPO these strategic doorways are open,” Keough stated.
Scout is hiring for almost each place you may consider, he stated, from human assets to manufacturing and engineering.
Most surprisingly, Scout is investing $2 billion in its personal manufacturing unit. Development work is underway in Blythewood, South Carolina, the place, Keogh stated, Scout has entry to vary of suppliers. Volvo, Mercedes and BMW have already got long-established factories in South Carolina.
The corporate additionally has its personal design heart in Novi, Michigan, with its personal head of design, Chris Benjamin, who beforehand labored for Mercedes, Volvo and Stellantis, which owns Jeep.
The Scout EVs will combine nostalgic cues with out being overly retro, Keogh insists. Up to now the corporate has proven solely obscure silhouette photographs of the SUV and truck. The corporate has examined fashions displaying simply the final form to clients and the suggestions has been good, he stated.
The brand new Scout might be completely different than the traditional ones, in fact. These autos will characteristic fashionable expertise and, most crucially, they’ll be all-electric. That a part of the plan has not modified at the same time as EV sales growth has dampened within the US market. Keogh stated he isn’t apprehensive.
“I take a look at individuals who personal and drive electrical autos they usually love them,” Keogh stated.
The trade faces challenges with battery prices and charging infrastructure, he allowed, however these issues might be labored out. Scout’s father or mother firm, Volkswagen, is constructing its personal EV battery plant in Canada and a battery engineering lab in Chattanooga, Tennessee. And the EV charging firm Electrify America can also be VW-owned.
The autos are anticipated to go on sale in early 2026, costing round $45,000. That may put the SUV in competitors with the Tesla Mannequin Y, the Ford Mach-E, and, most instantly, Rivian’s new R2 SUV, one other electrical off-roader that’s anticipated to hit the market across the identical time.
If there may be any firm that might do that and make it work, it’s Volkswagen, stated Keating, who used to work for VW. The corporate efficiently manages quite a lot of completely different manufacturers world wide typically finely tuned to completely different markets. VW even relaunched Bugatti from, actually, nothing however a disused trademark.