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Volkswagen lays off 500 Chattanooga workers

The redesigned Volkswagen Passat has been a decent seller since its debut in 2011, but sales have apparently dropped off enough that the automaker is trimming some of the employees from its Chattanooga, TN assembly plant. According to Automotive News, Volkswagen will be cutting shifts and laying off 500 contracted workers in response to slowing sales.
Currently, the plant has three teams running 10-hour shifts Monday through Saturday, but starting May 13, this will be reduced down to two teams running 10-hour shifts Monday through Thursday. This will be done to reduce dealer inventory (the article says that VW dealers, on average, have a 97-day supply of Passats) and production capacity (currently running at an annual pace of 170,000 units, which is more than the 150,000 annual units the plant was planned to produce).
This, of course, isn't saying that the Passat has been a failure since VW added 200 full-time employees to the plant in February 2012 to keep up with increased demand. The AN article says that automakers frequently overstaff plants during the launch of a new product - or in this case, a new product and a new plant - but eventually reduce the workers as things run smoother and more efficiently.

Volkswagen breaks 40-year-old sales record in 2012

The last time Volkswagen moved this many vehicles in America in one year, Richard Nixon was still a President in good standing, Let It Be was a radio hit and each car wearing the VW badge boasted an air-cooled engine. That's right, with a grand total of 580,286 vehicles sold in the US last year, the VW Group has broken its own four-decades-old sales record by 2,899 vehicles.
Of that 580k total sold, 438k were Volkswagens and 139k were Audi products - increases of 35.1 percent and 18.5 percent, respectively, in year-over-year sales. The ultra-premium members of the VW group also fared well; Bentley delivered 2,315 vehicles for a 23.3-precent increase, and Lamborghini delivered 520 units for a 52.9-percent jump. Bugatti, we're told is "right on track."
Jetta (pictured) sales paced the marque with 170k models sold, and Passat also finished very strong with sales of 117k total. Tiguan also racked up its best year on file, with 31,731 models shifted.

Car companies may need to start curbing model proliferation

Looking at the current automotive landscape, especially from German makers, you quickly get the impression that less definitely isn't more. BMW alone offers its 3 Series platform in practically every segment possible, including the regular sedan and 4 Series Gran Coupe, which would seem to be direct competitors. Porsche might be the winner, though, with 20 different variants of the 911 listed for sale on its US website. However, some of this model madness might be reaching an end as companies begin cutting back spending or shifting money to other priorities.
According to Yahoo Finance, the offerings from the German automakers are up 25 percent over the past three years to over 200 models in Europe. The peak is expected to come around 2018 at 230 separate vehicles, according to consulting company PwC.
Amazingly, BMW, which is among the poster children for this model explosion, might be changing its tune. "I'm sure there will be points in the future where we look at certain cars and say, 'Maybe we need to think differently now,'" said head of sales Ian Robertson in an interview, according to Yahoo Finance. The statement certainly sounds shocking coming from a company rumored to have 23 front-wheel-drive vehicles all using a single platform on the way.