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 |  Apr 12 2010, 10:41 AM

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Volkswagen will offer its new mid-size sedan with both gasoline and diesel engines says VW North America boss Stefan Jacoby. In doing so VW will be the only automaker in North America to offer a mid-size diesel sedan, competing against the likes of the Honda Accord, Toyota Camry and Ford Fusion. The popularity of hybrid mid-size sedans has grown and if VW decides to offer the same TDI motor that powers both the Golf and Jetta then we should expect hybrid-rivaling fuel economy numbers with the Jetta TDI achieving 29/40 mpg (city/highway).

The new mid-size sedan is expected to be larger and less expensive to help it compete with other mid-size sedans and while part of the cost is expected to be the result of a less-premium interior compared to VW’s current mid-size offering (the Passat), much of the cost savings will also made from building the car in the U.S. at the company’s Chattanooga, Tennessee plant. The new mid-size sedan from Volkswagen is set to go on sale next year.

In other VW news, during the same press conference Jacoby waffled on earlier reports that the Golf R was destined for U.S. shores, saying the decision was, “still up in the air.” The main reason the car might not be offered in the U.S. is the poor dollar-to-Euro exchange rate right now. The Golf R, currently on sale in Europe, uses a turbocharged 2.0-liter 4-cylinder engine to makes 265-hp and 258 ft-lbs of torque, combined with VW’s 4MOTION AWD setup to deliver a 0-62 mph time of just 5.5 seconds! We’ve speculated in the past that despite those reports to the contrary, the Golf R is unlikely to find its way to the U.S. due to how much it would cost here.

As for the Audi brand, the high-performance S5 model will continue to be offered with a V8 for 2011, rather than the supercharged 3.0-liter V6 currently being used in the A6 3.0T and S4.

[Source: NewYorkTimes]