WOLFSBURG, Germany (REUTERS) - Volkswagen's top labour representative has dubbed the carmaker's United States operations a "disaster" and urged more models and swifter decisions to help revive the German group's declining fortunes in the world's second-largest auto market.

While VW has risen to become the biggest automaker in China and Europe, the group still has not fully understood how to succeed in the United States, Mr Bernd Osterloh, VW's works council chief, told reporters in Wolfsburg on Wednesday.

"The US are a case of disaster" for VW, said Mr Osterloh who also sits on the carmaker's supervisory board.

The German multi-brand group last month ousted US divisional chief Jonathan Browning who oversaw the much-lauded 2011 launch of the midsize Passat, sales of which declined 6.3 per cent last year following a 2011 to 2012 surge.

Mr Osterloh echoed criticism from the company's new head of US operations, Mr Michael Horn, who earlier this month faulted VW headquarters for paying little heed to the dynamics of the US market.

VW's situation in the United States, where the company has been grappling with losses for years, will not improve until 2016 and it needs more models there, including a pick-up truck, Mr Osterloh said.

VW announced at the Detroit auto show plans to make a sport-utility vehicle (SUV) for North America as part of a US$7 billion (S$9 billion) investment in the region.

Mr Osterloh lamented that a year after the "CrossBlue" SUV was unveiled, it is still unclear where the model will be built.