Volkswagen of America chief Michael Horn has told Automotive News that new midsize and small sport utility vehicles are needed in the U.S. to spur the brand’s growth.

VW of America's Michael Horn

Horn said that the company has reached a key plateau of 400,000 annual vehicle sales in the U.S. and that when new SUVs come on line “we plan to build up from there.”

VW is said to be close to making a decision on where to assemble a new midsize SUV.

The automaker has said that Chattanooga is the front-runner to make the vehicle ahead of VW operations in Mexico.

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