WOLFSBURG, Germany – Volkswagen AG’s upcoming new U.S.-built sedan will be substantially larger than today’s Passat model, and the plant site that will produce it in Chattanooga, TN, is designed to be expanded to twice its current size, top officials reveal during a media preview here.

VW executives are meeting with automotive journalists during a preview of the ’10 Golf, which went on sale in the U.S. last week. However, they cannot resist teasing reporters with a few tidbits of information about the upcoming sedan that will go into production in 2011 at the auto maker’s new plant in Tennessee.

VW Chief Designer Walter M. de Silva reveals several rough sketches of the new sedan at the end of a presentation on the new design language of the Golf, but declines to offer further details.

The sketches depict a larger, more-imposing sedan than today’s Passat. Several executives have said the current Passat is considered too small to compete head-to-head with the likes of the Toyota Camry, Honda Accord and Chevrolet Malibu in the U.S. market.

“We will make the Passat successor exactly match the Toyota Camry in size,” one executive says during a casual conversation with reporters.

The ’09 Passat has a 106.7-in. (271-cm) wheelbase and is 188.2 ins. (478 cm) long, while the ’09 Camry has a 109.3-in. (278-cm) wheelbase and is 189.2 ins. (481 cm) long.

The new car, yet to be named, also will be offered with a diesel engine and VW’s acclaimed DSG dual-clutch transmission.

The German auto maker is at a crossroads in the U.S., Volkswagen of America Inc. CEO Stefan Jacoby tells Ward’s during a recent interview in Frankfurt. The company is introducing new advanced powertrains just as fuel economy is becoming a paramount concern for consumers.

Meanwhile, the pending production start at Chattanooga blends neatly with VW’s volume aspirations. For these reasons, there is an “ideal opportunity” for the auto maker to change its image in the U.S. market, he says.

Everyone is familiar with, or has a story about, a VW product, Jacoby says. But when it comes to the purchasing decision, “this is where we have to (attract) the consumer and shift the American public.”

That’s why the auto maker is shopping for a new ad agency, severing its ties with Miami-based Crispin, Porter and Bogusky, creator of the “Safe Happens” commercials featuring live-action collisions that polarized viewers.

The agency also pushed for the previous-generation Golf to be renamed the Rabbit, a move that VW officials now say was a mistake, given that the Golf has won a “World Car of the Year” award and is known in all other markets under that name.

“We want to be sure that we have the right advertising partner, who understands where the brand is right now, and where do we want to shift the brand,” Jacoby says, adding VW is not content to occupy a “niche” in the U.S.

“We need to move the brand into a much higher awareness with the American mainstream customer.”

And, while the Chattanooga plant officially is said to have production capacity of 150,000 units, a Volkswagen executive says the site is designed to accommodate a mirror-image of the planned facility that would double capacity.

Jacoby makes it clear the auto maker has its sights set on industry leader Toyota Motor Corp. and plans to prevail by providing more stylish and emotional alternatives while boosting consumer confidence in the quality and reliability of Volkswagen products.

The new car to be built at Chattanooga is key to VWA’s lineup strategy, he says. Currently, the brand has many vehicles occupying a narrow bandwidth in the U.S. market – a deciding factor in VW’s decision not to bring in the sporty Scirocco.

“I have to admit we are punishing the American consumer (with that decision),” Jacoby says. “I definitely wanted to have the Scirocco. But the economics didn’t work for the vehicle. It (is) too close to the Golf GTI.”

– with Eric Mayne in Frankfurt

dwinter@wardsauto.com

emayne@wardsauto.com