Speaking with Automotive News from the Geneva auto show, VW group CEO Martin Winterkorn outlined the company's multi-point plan to boost VW and Audi sales in the United States to 1 million units by 2018.

In 2006 the company moved only 328,068 units, but starting with the building of an assembly plant, the long-term goal is to go head-to-head with Toyota.

Currently the governors of several states have presented economic packages to VW with locations in North Carolina, South Carolina, and Georgia topping the competition.

A decision should be made by early summer and the facility will likely construct a replacement for the Passat in the U.S. market. The vehicle will be priced in the $20,000 range, bringing it under the current entry level Volkswagen Passat sticker at $24,680.

Additionally VW is considering a new offering in the size range of the Honda Fit, a body-on frame pickup, a less expensive Jetta more tailored to American tastes, and a smaller, diesel-powered Phaeton.

Winterkorn stressed the need to build cars suited to the American market. "The Jetta and Passat are too expensive," he said. "We need models that hit the sweet spot."

Currently the base model Jetta is priced at $17,030. The company's plans for a replacement, still in development, would bring the cost down to the $15,000 range.