In a first for the German carmaker, Volkswagen will develop the vehicle especially for the hyper-competitive US car market. The company's US manager Stefan Jacoby told the Financial Times Deutschland newspaper that the first models should arrive by the middle of 2011.

"We're attacking competitors on size, quality and price," Jacoby told the newspaper. The new model will be longer and wider than the current German Passat model and will be built at a new Volkswagen factory in Tennessee.

Volkswagen plans to price the car competitively, selling it for less than 20,000 euros ($30,000).

By rolling out the new model, Volkswagen is setting its sights squarely on Toyota, whose Camry sedan is one of the best-selling vehicles in America. The company plans a massive advertising campaign to raise awareness of Volkswagen's offerings.

""Our goal is the have recognition in America like Toyota's," Jacoby said. Although Volkswagen is a dominant player in Europe, it is only niche seller in the US, where it holds just two percent of the market.

Our market share isn't enough for us," Jacoby told the FTD. "In the next three to five years we want to raise our American sales by 400,000 to 450,000."

Jacoby added that Volkswagen's luxury car unit, Audi, was also building cars at another US factory.

bn/AFP/AP
Editor: Sam Edmonds