The difficult part is that H/K has mastered the means to build a cheaper car across their entire lineup, while VW struggles with lowering the costs at the expense of losing the little things that made them so popular (including losing the uniqueness of their designs).
VW
could be as good as Hyundai/Kia at building an inexpensive car. MQB was a brilliant step in that direction, and the concept came from VW*, not H/K. VW certainly has global purchasing power that H/K can only dream of at this point. Yet...
Maybe it has something to do with quality control and customer service. H/K move on quickly when they find something isn't working. VW (like BMW and Daimler) seems far more likely to insist that the problem should be accepted because, well, German engineering and, besides, you didn't care for the car properly. Part of every car's cost is the cost of warranty work and recalls. It would be interesting to find out what H/K and Honda and VW and FIAT charge for that...
* apparently Renault has an architecture similar to MQB also.
Some of VWs issues are down to perception - many EXPECT H/K offerings to be cheaper in both costs and quality. Despite how nice the new k9 or genesis is, it still doesn't meet the level of quality of upper level offerings from europe. The same applies to VW - people (and reviewers and fan-boys) expect more from the german entry regardless of price.
People said the same kinds of things about Toyota when they introduced Lexus. Maybe the Asian manufacturers still don't hit the
very highest levels of automotive engineering. But they do compensate for not being on the "bleeding edge" by not exacting a pint of blood from their owners in the form of expensive failures and repairs. For many buyers, that's much more important.
I think VW in North America finds itself as a crossroads. It's hard to sell "German-engineered" when the NA Jetta and rebadged Chrysler Town & Countrys sit on the sales floor. It's hard to sell "value for money" with $32K GTIs and Golf Sportwagons (by no means "halo cars"). It's hard to sell "fun to drive and economical" when they are flogging ancient engines and "it comes in four colors [and two of them are gray]". It's hard to sell customers on engineering when the engineering doesn’t matter to them (I love that VW warrants against rust for 12 years. But if I were the typical H/K driver trading in every four years or so, why would I care?).
Maybe once VW decides what makes a VW a VW, they can concentrate on creating them more efficiently. Meanwhile, I think Hyundai/Kia have a very good idea of who they are -- Japan, circa 1990. And they'll likely avoid the mistakes the Japanese made, too.
