* VW agrees 5.5 year contract with soccer association
* Alliance starts in January 2019
* VW to pay 25-30 mln eur per year -source (Adds comment from VW brand CEO and background)
FRANKFURT/BERLIN, July 14 (Reuters) - Volkswagen is to become the biggest commercial sponsor of Germany’s national soccer team, it said on Friday, replacing luxury carmaker Mercedes-Benz after 45 years.
The 5-1/2-year partnership between the world’s biggest carmaker by sales and the DFB national soccer association will start in 2019, Volkswagen (VW) said. The German team will be defending their World Cup title in Russia next year.
A source at the company said VW will pay between 25 and 30 million euros ($29-34 million) a year for the contract, including 6 million euros in sponsor fees for the DFB German Cup competition.
Given soccer’s huge popularity VW views the deal with the national team as an ideal marketing platform as it seeks to restore its image following the “dieselgate” emissions test cheating scandal and makes a strategic shift towards electric cars.
“As a company we have set ourselves some ambitious goals for the next years,” the VW brand’s chief executive Herbert Diess said. “Volkswagen is changing, we are facing great challenges. The partnership with the DFB will help us in that way.”
Wolfsburg-based VW has for years spent heavily on its own Bundesliga soccer team even though experts have questioned the business case because its VfL Wolfsburg club has only limited revenue streams and lacks an international fan base. ($1 = 0.8761 euros) (Reporting by Andreas Cremer and Karolos Grohmann; Editing by Georgina Prodhan, Greg Mahlich)