VW makes changes to improve earning performance

A NUMBER of Volkswagen variants will be dropped from the German car-maker’s European line-up in the coming years as it seeks to improve its earning performance and increase its focus on e-mobility.

 

In an announcement made last week, Volkswagen said it would discontinue 25 per cent of its European-market engine-transmission variants “with low customer demand” in the next year, however the company is yet to confirm what they will be.

 

A spokesperson for Volkswagen Group Australia told GoAuto that the variant rationalisation was unlikely to impact the Australian model range. 

 

A number of local VW variants, including some Golf model grades, have been put on hold due to testing delays relating to the Worldwide Harmonised Light Vehicle Test Procedure (WLTP).

 

In order to improve the brand’s operating return, Volkswagen chief operating officer Ralf Brandstaetter said more changes were necessary.

 

“We must force the pace of our transformation and become more efficient and agile,” he said. “We cannot let up in our efforts and must realise further substantial improvements. What we have achieved so far is still not enough.”

 

The VW brand will invest more than €11 billion ($A17.46b) into e-mobility, digitisation, autonomous driving and mobility services between 2019 and 2023, with the majority of that (€9b) going to electrification.

 

Currently, VW has two fully electric vehicles in its program – including the imminent ID hatchback – but this will increase to about 20 by 2025, with the company targeting a production figure of one million units per year by that time. 

 

VW will have three European production sites building EVs (Zwickau, Emden and Hanover), two in China (Anting and Foshan) and another yet-to-be-determined site in the United States.

 

To finance the massive investment, VW says it will save €3 billion ($A4.76b) by 2020 through a number of measures, including increasing the number of conventional models based on its MQB platform from 60 per cent of its line-up to 80 per cent.

 

Models such as the Polo, Golf, Passat, Arteon, Tiguan and Tiguan Allspace are all based on the MQB architecture. It is also shared with other brands in the VW Group portfolio, including Skoda, Audi and Seat.

 

VW expects 15 million vehicles based on its new all-electric MEB platform to be produced as part of the first wave of its electric models from 2019. This is an increase over the 10 million units it originally planned for in that period. 

 

As part of its push to speed up its operating return, VW will increase plant productivity by 30 per cent up to 2025.

 

VW’s first all-electric model to hit Australia is expected to be ID small hatch in about 2021, and it will eventually be joined by more ID models.

 

The MEB platform will have a scalable battery pack capable of achieving a driving range of between 330km and 640km, and being charged to 80 per cent capacity in 30 minutes on a fast charger.

 

Meanwhile, Audi AG announced last week that it plans to spend about €14 billion ($A22.2b) in electric mobility, digitalisation and autonomous driving between 2019 and 2023.

 

In total, Audi plans to spend €40 billion ($A63.46b) in the next five years.

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