Volkswagen of America, Inc. Announces Its Decision to Hire New Media Placement and Media Buying Firm

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January 28, 2005

Source: Audi of America

AUBURN HILLS, Mich. – Volkswagen of America, Inc. announced it will employ the services of MediaCom in New York, concluding a formal review process to decide on an agency to handle its future advertising media planning and buying for its car ads in the U.S.

The decision marks a change for the German automaker in the U.S. and ends its almost decade-long work with MPG USA of Boston, which is a subsidiary of the Paris-based company, Havas. MPG USA, which Volkswagen recognized as being a valued partner through the years, was invited to participate in the review that began last September. Volkswagen said the decision to work with MediaCom does not affect its commitment to continue working with its advertising agency of record in the U.S., Arnold Worldwide of Boston, which began with Volkswagen of America in 1995 and is also part of the Havas company.

Volkswagen said the decision to use a new media agency was not an indication of its dissatisfaction with MPG USA but was instead viewed as an opportunity to take advantage of Volkswagen AG’s significant global purchasing power. Volkswagen AG, one of the world’s largest automakers with annual sales typically exceeding 5 million, already uses MediaCom, a member of the Grey Global Group, for the majority of its global media buying. Volkswagen of America said it anticipates that its decision to also work with MediaCom will result in improved financial efficiencies and more influence in the marketplace given its parent company’s formidable international business clout in media buying.

Separately, Audi of America, Inc. also reviewed its MPG media planning and buying and made the decision to use MediaCom for media buying but will continue to work with its advertising agency of record, Havas-owned MCKINNEY of Durham, for media planning.

Volkswagen and Audi said they plan to begin transitioning their respective work to MediaCom in the coming months, after ensuring all contractual commitments are met with MPG USA.

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