[UPDATE 12:40 p.m. EDT] “Volkswagen is lacking exciting new product in key vehicle segments,” said Karl Brauer, senior analyst at Kelley Blue Book. “The Tiguan is one of the oldest vehicles in the compact SUV segment, and it carries one of the highest prices. The Golf and Jetta are also among the oldest models in the compact segment. Even the Passat, which was redesigned for 2012, has lost its 'all-new' sheen in the shadow of the seductive Fusion, superb Accord and value-priced Altima, all of which were ground-up redesigns for 2013.

Original story begins here: 

Volkswagen Group of America Inc., the U.S. unit of Volkswagen AG (FRA:VOW3), said Thursday it sold 35,779 units in the U.S. last month, a 3.3 percent decline from the same period last year and a 1.3 percent drop from June as the German auto giant faced stiffer competition from competitors’ new offerings in the passenger car segment. “We are entering a period of consolidated growth as we phase out 2013 model-year vehicles,” said Mark McNabb, chief operating officer for Volkswagen’s U.S. operations.

The sales numbers broadly missed the average 51,315-unit forecast by leading auto intelligence providers TrueCar.com, Edmunds.com and Kelley Blue Book, which have been expecting better performance from the Wolfsburg-based maker of the Chattanooga, Tenn.-built Passat full-sized sedan, which made up 28 percent of Volkswagen’s total U.S. sales volume in July.

Volkswagen spent $2,699 in incentives last month, according to TrueCar.com, essentially in line with the industry average. Its average transaction price last month was $33,614, above the average of $31,088. Companies that do well in the truck and luxury car segments generally have higher profit margins, but Volkswagen doesn’t have a truck to sell in this lucrative U.S. segment.  

The company saw declines, many of them in the double digits, in all models except the SportWagen (up 17.7 percent to 2,310), the Beetle (up 85 percent to 5,256, largely on the back of sales of its newer convertible) and the Passat (up 11.6 percent.)  Ford Motor Co. (NYSE:F) snatched up market share in the small and subcompact sedans, knocking Volkswagen’s Golf/GTI group down 33.5 percent.