Volkswagen mulls new midsize SUV for North America

Volkswagen CEO Martin Winterkorn told reporters in New York on Tuesday that a decision on whether to build the new model will be made soon, but probably not before the end of the year.

"If we produce the car, Chattanooga would certainly present itself as an option for doing the whole thing," Winterkorn told reporters in German. But he said other locations would also be considered to build the SUV, which would be positioned between VW's existing Tiguan and Touareg models.

Volkswagen subsidiary Audi in April announced plans to build its first North American plant in Mexico. Volkswagen executives have said that decision was based in large part on Mexico's wider array of trade agreements that would help spur exports.

Winterkorn in prepared remarks lauded VW's experience in building Passat sedans at the Chattanooga plant that opened last year and stressed that the US remains a pillar in the company's global growth strategy.

The $1 billion Chattanooga plant is expected to build 180,000 vehicles next year and has a maximum capacity of 220,000 in its current configuration.

Winterkorn said Volkswagen expects that all Volkswagen brands, including Audi and Porsche, will set a record sales of 500,000 vehicles in the U.S. this year. VW-branded vehicle sales grew 37 percent through September to 323,000.