Being No.1 in Japan's import car market year after year is not limiting Volkswagen AG's ambitions. Next step up is to become a major brand player in the world's second-largest car market.

“Our goal is not to challenge Honda or Nissan but to become an influential player in the Japanese market with benchmark brands,” says Tsutomo Umeno, the new president of Volkswagen Group Japan K.K. “We already sell more regular-size cars in Japan than Daihatsu (Motor Co. Ltd.) and Suzuki (Motor Corp.),” he adds, “and have almost 2% of the total car market.”

The success formula now being embraced: new brand width, stretching from the top to the bottom of the market to augment the company's best sellers.

They include the Golf, which accounts for 46% of Volkswagen Japan sales; the New Beetle, which is more popular in Japan than in Germany with 22% of total VW sales; and the Polo, with 20%. Demand exceeds supply of the 1.4L Lupo launched last July.

The new Passat introduced in October, with a choice of 2.3L or 2.8L engines, will be followed next year by a V-8 model, plus a new Polo. The D1 (Phaeton), designed to compete with the Mercedes S-Class, is due in Japan in 2003. An SUV now under development will show up later.