VW wants micro car

The German brand, one of the few mainstream players in Australia to increase sales this year despite the economic crisis, has revealed it wants to add a micro car to its local line up.

In contention is the two-seat city car, dubbed the Chico, which is being developed by VW in Europe to take on Toyota's new iQ and the Smart Fortwo.

Jutta Dierks, the head of VW Group Australia, has given strong support to the addition of the tiny compact to VW's line up here. It would slot in under the existing Polo, the smallest car currently sold by VW in this country.

"Would we want it? Of course we would. It would be a perfect model for us to attract a whole new group of buyers to the VW brand," she says.

But there are a couple of major stumbling blocks. It is still not known if the micro car, tipped for sale in Europe in 2010, will be available in right-hand drive.

"We would only be interested if it were available with an automatic transmission - that's a must,” Dierks says.

"But it would be a fabulous car for us. It's firmly on our wish list. We have never, in recent times anyway, had a car smaller than the Polo and it would attract new, younger, customers; those on a budget looking for a new car instead of a second hand one.”

Dierks says the car, a development of VW's Up concept car, won't however be the cheapest small car on the market if it came here. "It wouldn't be a $12,000 budget car; it has to deliver the safety and quality standards we demand in all our models. If we could sell it for $13,990 I would be more than happy."

It's been tipped the Chico will be powered by a 1.2-litre four-cylinder petrol engine or three-cylinder diesel, with a potential fuel consumption of well under 4l/100km and return class-leading clean exhaust emissions for a non-hybrid model.

Meanwhile, VW Australia has still to make a decision on whether to add the potent Scirocco coupe to its line-up. The coupe was last month named Top Gear's car of the year in the UK.

And buyers wanting to buy the new and slightly larger Jetta will have to wait at least another year. The popular Jetta, tipped to be repowered by a smaller 1.4-litre twin charge petrol engine alongside the existing turbo diesel, was expected to arrive next year but it has now been put off until at least 2010.

Next year's major launch for VW Australia has been reserved for the new Golf, VW's biggest seller in this country. The new Passat CC will also arrive next summer.