Pulling the SEAT Out From Under Europe

As you can gather from the fact that I spelled "seat" entirely in capital letters, I'm not talking about Trump's plans for dealing with NATO allies.

Volkswagen AG, which has owned Spanish automaker SEAT since 1990, announced a few months ago that the SEAT brand is being retired once the life cycle of its current models ends.  The marque - one step up from the entry-level Škoda brand and one step below the Volkswagen brand itself in the Volkswagen Group's European-market hierarchy - was the nineteenth bestselling brand in Europe for the first half of 2023, selling 155,355 units in that six-month time frame - up 13 percent from the first half of 2022.  Pretty decent numbers, until you notice that the Cupra brand - a SEAT spinoff based on the SEAT León Cupra sport compact, sort of a Spanish equivalent to the Golf GTI - sold 111,829 units in the first half of 2023, up by 47 percent from the first half of 2022.  What's more, Cupra offers cars much more pricey than SEAT cars, thus offering bigger profit margins for Volkswagen AG, while SEAT had been losing money.  Also, SEAT's most recent all-new model is the Golf-based fourth-generation León, which debuted in January 2020.  "The success of the Cupra Formentor," automotive analyst Felipe Munoz reported, "was the key element to take this decision" to retire SEAT.

This is the Cupra Formentor.

Damn sport utility vehicles!

"It had been a debate to try and reinvigorate SEAT," Thomas Schafer, the CEO of Volkswagen Passenger Cars, told Autocar magazine, "but the brand had a history of making losses, and ultimately Cupra’s earning potential, cemented the decision."

I'm just glad that Carl Hahn, who died in January 2023, didn't live to see this.  Hahn, as Volkswagen AG chairman in the 1980s, had gone into a partnership with SEAT in 1986 when Spain was still endeavoring to make the transition from fascist state to constitutional monarchy  (and the experiment in Spanish democracy was almost stifled in 1981 when the Spanish army staged an unsuccessful coup d'etat by occupying the Parliament building in Madrid).  The deal allowed SEAT to make more Volkswagens for the European market to meet demand, and Hahn bought the company outright four years later, expanding Volkswagen's dominance in Europe while creating new economic opportunities in Spain.  Hahn had, by all accounts, saved a storied auto marque that is as beloved in Spain as Chevrolet is in the United States. And, as I noted in my obituary for Hahn, he took an orphaned state-owned industrial enterprise, as Volkswagen itself had once been, and turned it into a reputable, solid car make, combining a romantic vision with an opportunistically capitalist one.  The current VW leadership has no sense of romance or heritage, preferring to sacrifice a subsidiary company with a history going back seven decades for the almighty euro.  But then, maybe I'm getting too romantic.  This wouldn't be the first time a storied European brand has died what was likely an inevitable death, as fans of the old NSU brand from Germany would attest.

SEAT is likely to remain in business with its current and final crop of cars until 2030.  Cupra could come to North America, though that's probably more wishful thinking than anything else.