SECURITIES AND EXCHANGE COMMISSION
                     WASHINGTON, D.C. 20549
                       -----------------

                           FORM 10-K


      ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 1996    Commission File No. 33-80055

         Volkswagen Credit Auto Receivables Corporation
                          on behalf of
              Volkswagen Credit Auto Master Trust

(Issuer of the Volkswagen Credit Auto Master Trust Floating Rate
Dealer Loan Backed Certificates, Series 1996-1 (the "Certificates"))

       (Exact name of registrant as specified in its charter)
                             ----------

State of Delaware                                 38-2748796
(State or other jurisdiction of          (I.R.S. Employer Identification No.)
 incorporation or organization)

3800 Hamlin Road
Auburn Hills, Michigan                                        48326
(Address of principal executive offices)                    (Zip Code)

Registrant's telephone number, including area code:  (248) 340-4938
                           ---------------

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act:
     Form 8-A was filed with the Securities and Exchange Commission
(the "Commission") registering the Series of Certificates pursuant
to Section 12(g) of the Securities Exchange Act of 1934 (the "Act").

     Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 (the "Act") during the preceding 12
months (or for such period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements
for the past 90 days.

     YES    x*                         NO

     State the aggregate market value of the voting stock held by
non-affiliates of the registrant. The aggregate market value shall
be computed by reference to the price at which the stock was sold,
or the average bid and asked price of such stock, as of a specific
date within 60 days prior to the date of filing. (See definition of
affiliate in Rule 405, 17 C.F.R. 230.405):

     NOT APPLICABLE


     * On May 9, 1997, the registrant was issued a no-action letter
(the "No-Action Letter") by the commission with respect to certain
of the registrant's reporting requirements pursuant to Section 13 or
15(d) of the Act. This Form 10-K has been prepared in accordance
with the terms of such No-Action Letter.



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              FORM 10-K (Pursuant to No Action Letter)

                               PART I

Item 1.  Business.

          Omitted pursuant to the No-Action Letter.


Item 2.  Properties.

          Pursuant to Section 3.06 of the Pooling and Servicing
     Agreement (the "Pooling Agreement") dated as of February 29,
     1996 relating to the Volkswagen Credit Auto Master Trust (the
     "Trust") among Volkswagen Credit Auto Receivables Corporation,
     VW Credit, Inc. and Citibank, N.A., as trustee (the "Trustee"),
     Coopers & Lybrand L.L.P. has performed certain procedures in
     connection with the Monthly Servicer's Certificates (the
     "Monthly Certificates") for the months of March 1996 through
     December 1996. The Monthly Certificates contain information
     relating to the receivables (the "Receivables") and the
     accounts from which the Receivables arise (the "Accounts") and
     are prepared by the Servicer and delivered to the Trustee
     pursuant to Section 3.04 of the Pooling Agreement. The report
     issued by Coopers & Lybrand L.L.P. in connection with the
     servicing activities of VW Credit, Inc., as servicer (in such
     capacity, the "Servicer"), is attached hereto as Exhibit 99.2.
     The Monthly Certificates containing information relating to the
     Receivables and the Accounts for the Collection Periods from
     and including March 1996 through December 1996 are incorporated
     by reference from the registrant's Current Reports on Form 8-K
     filed with the Commission on July 16, 1996, July 16, 1996, July
     16, 1996, July 17, 1996, September 13, 1996, September 25,
     1996, October 17, 1996, November 18, 1996, December 18, 1996
     and January 21, 1997, respectively.


Item 3.  Legal Proceedings.

          The registrant knows of no material pending legal
     proceedings involving the Trust, Volkswagen Credit Auto
     Receivables Corporation, VW Credit, Inc. or the Trustee (in its
     capacity as such), other than routine litigation incidental to
     the business of the Trust, Volkswagen Credit Auto Receivables
     Corporation, VW Credit, Inc. or the Trust (in its capacity as
     such).


Item 4.  Submission Of Matters To A Vote Of Security Holders.

          None.

                            PART II

Item 5.  Market for Registrant's Common Equity and Related
Stockholder Matters.

          (a) To the best knowledge of the registrant, there is no
     established public trading market for the Certificates.

          (b) The Certificates are represented by one or more
     certificates registered in the name of Cede & Co. ("Cede"), the
     nominee of The Depository Trust Company ("DTC").

          (c) Omitted pursuant to the No-Action Letter.


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Item 6. Selected Financial Data.

          Omitted pursuant to the No-Action Letter.

Item 7. Management's Discussion and Analysis of Financial Condition
and Results of Operation.

          Omitted pursuant to the No-Action Letter.

Item 8.  Financial Statements and Supplementary Data.

          Omitted pursuant to the No-Action Letter.

Item 9. Changes in and Disagreements On Accounting And Financial
Disclosure.

          None.

                              PART III

Item 10.  Directors and Executive Officers of the Registrant.

          Omitted pursuant to the No-Action Letter.

Item 11.  Executive Compensation.

          Omitted pursuant to the No-Action Letter.

Item 12.  Security Ownership Of Certain Beneficial Owners And Management.

          (a) The Certificates are represented by one or more
     certificates registered in the name of Cede, the nominee of
     DTC, and an investor holding an interest in the Trust is not
     entitled to receive a certificate representing such interest
     except in limited circumstances set forth in the Pooling
     Agreement. Accordingly, Cede is the sole holder of record of
     Certificates, which it holds on behalf of brokers, dealers,
     bank, and other direct participants in the DTC system. Such
     direct participants may hold Certificates for their own
     accounts or for the accounts of their customers. The name and
     address of Cede is Cede & Co., c/o The Depository Trust
     Company, Seven Hanover Square, New York, NY 10004.

Item 13.  Certain Relationships And Related Transactions.

          There have not been, and there are not currently proposed,
     any transactions, to which either the Trust, Volkswagen Credit
     Auto Receivables Corporation, as seller, VW Credit, Inc., as
     Servicer, or the Trustee, on behalf of the Trust, is a party
     with any Certificateholder who owns of record more than five
     percent of the Certificates.

                               PART IV

Item 14.  Exhibits, Financial Statement Schedules, and Reports on Form 8-K.

          (a) Omitted pursuant to the No-Action Letter.

          (b) The registrant has filed Current Reports on Form 8-K
     containing certain financial information with regard to the
     Trust, the Receivables and the Accounts, in accordance with the
     No-Action Letter, on November 18, 1996, December 18, 1996 and
     January 21, 1997.

          (c)  3.1 The Articles of Incorporation and By-Laws of the
               registrant are incorporated by reference from
               Exhibits 3.1 and 3.2, respectively, of the
               registrant's Registration Statement on Form S-3 (File
               No. 33-80055).

          4.1  The Pooling Agreement and the Series 1996-1
               Supplement thereto are incorporated by reference from
               Exhibits 2.2 and 2.3, respectively, of the
               registrant's Form 8A filed with the Commission on
               September 13, 1996.



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          5.1  The opinion of Cravath, Swaine & Moore with respect
               to certain matters involving the Certificates is
               incorporated by reference from Exhibit 5.1 of the
               registrant's Registration Statement on Form S-3 (File
               No. 33-80055).

          8.1  The opinion of Cravath, Swaine & Moore with respect
               to federal tax matters is incorporated by reference
               from Exhibit 8.1 of the registrant's Registration
               Statement on Form S-3 (File No. 33-80055).

          8.2  The opinion of Honigman, Miller, Schwartz & Cohn with
               respect to Michigan state tax matters is incorporated
               by reference from Exhibit 8.2 of the registrant's
               Registration Statement on Form S-3 (File No.
               33-80055).

          23.1 The consent of Cravath, Swaine & Moore is
               incorporated by reference from Exhibit 23.1 of the
               registrant's Registration Statement on Form S-3 (File
               33-80055).

          23.2 The consent of Honigman, Miller, Schwartz & Cohn is
               incorporated by reference from Exhibit 23.2 of the
               registrant's Registration Statement on Form S-3 (File
               No. 33-80055).

          99.1 The Annual Certificate of VW Credit, Inc., as
               Servicer is attached hereto as Exhibit 99.1.

          99.2 The report on the activities of VW Credit, Inc., as
               Servicer, prepared by Coopers & Lybrand L.L.P.,
               pursuant to Section 3.06 of the Pooling Agreement is
               attached hereto as Exhibit 99.2.

          99.3 The Monthly Certificates containing information
               relating to the Receivables and the Accounts for the
               Collection Periods from and including March 1996
               through December 1996 are incorporated by reference
               from the registrant's Current Reports on Form 8-K
               filed with the Commission on July 16, 1996, July 16,
               1996, July 16, 1996, July 17, 1996, September 13,
               1996, September 25, 1996, October 17, 1996, November
               18, 1996, December 18, 1996 and January 21, 1997,
               respectively.