Volkswagen NMS (2010)

Although these are simply low-resolution camera phone images, this is the very first time Volkswagen’s soon-to-be Chattanooga-built “mid-market” sedan has ever been spotted (and photographed) in the United States. The new sedan is intended to go head-to-head with the Honda Accord and Toyota Camry.

Referred to as the NMS, this new car will fit in-between the Jetta and Passat in VW’s lineup, and will likely have a starting price of around $20,000.

In contrast to most future vehicle plans, Volkswagen has openly mentioned the NMS and what they hope to accomplish with this vehicle, as well as required amenities. VW has hinted that the new sedan will boast generous legroom, a larger trunk, bigger cup holders, improved interior quality, a six-speed dual clutch transmission, gas and diesel powerplants and the possibility of all-wheel drive.

Initially, engines and transmissions will be manufactured in Mexico – the same ones as found in the New Beetle and Jetta. A previously-spotted test mule – as clearly seen on the paper affixed to the windshield – was powered by VW’s 2.5-liter I5.

In addition to the North American market, VW may be also developing this platform for the Chinese market.

As previously reported, the new sedan will be larger and cost nearly $8000 less than the current Passat.  That puts the NMS in the low $20,000 range, a much more competitive price.  Such an offering would put the NMS as a direct threat to market segment leaders Toyota Camry and Honda Accord.

A press agent for Volkswagen said, «We’ll have two sedans coming out at the same time, and the smaller one will cost considerably more than the bigger one.»

Volkswagen is choosing to build the NMS in Chattanooga, Tennessee to take advantage of the weak dollar.  The US dollar has lost nearly 15 percent of its value against the Euro since March 2009.  This translates to significantly higher American pricing for any vehicle built in Germany.

With the onset of the NMS, which is targeted to sell 100,000 units per year, the Passat is rendered virtually uncompetitive.  This is supported by an incredibly low 9,200 Passat units sold in the first nine months of 2009. As a result, VW is reportedly considering the cancellation of the Volkswagen Passat line within two years.