In the face of hardship facing the Volkswagen Group, chief executive officer Matthias Mueller outlined a 15-point strategic plan to bring the German automaker back to a more positive outlook.
The VW Group is expected to cut US$9 billion in costs; have up to 25% of its vehicle lineup powered by some level of electrification, be they hybrids or full electric vehicles; further streamline its vehicle architectures; and make its auto parts operations an independent business which involves over 10% of its personnel.
“There is no doubt that we have severe weaknesses, above all when it comes to our structure, culture and efficiency; we want to eradicate them, and the new strategy will make a considerable contribution,” Mueller said during a news conference with strategy chief, Thomas Sedran.
Mueller announced the aim to sell 2-3 million EVs and plug-in hybrid vehicles by 2025. This would make up 20-25% of total group volume, Mueller estimated.
For that to happen, Mueller said the company has been evaluating the feasibility of manufacturing their own battery packs and even battery cells on an industrial scale. At those numbers, Mueller estimates VW will need 150 gigawatt-hours of battery supply; three times that of Tesla’s planned Gigafactory.
If the automaker takes on the manufacture of batteries themselves, the battery plant could be part of the aforementioned separate auto parts division which will take up more than 10% of staff. Measures such as this are meant to manage costs, which consume over 90% of VW’s annual US$240 billion revenue.
For the future, the automaker plans to reduce its research and development budget from 6.4% of automotive revenue to 6%, which will go towards its goal of reducing costs by US$9 billion.
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I read today that VW shars went up higher on news that they have come up with an effective diesel emmission compensation plan. Its amazing how strong the group is, despite having allocated more than US$20 billion to pay for the diesel emmission scandal. Mitsubishi and Suzuki have problems surviving even with a US$5 billion deal.
What about Proton? Surviving for 30 years should prove how strong the company is
looks like the next cycle of products.. 2018 and beyond are going to be affected…VW cars for the next 5 to 10 years are gonna be a cost cutting affair… stay away….
People just love to condemn VW on the old stories bout defects and CO2 scandal, paul tan would continuous posting these boring news.
Get Mueller to head proton…
MAS Mueller?
the new CEO is very good….anyway, he’s been a veteran of the VW group for 30 years +-, starts wt Audi, then Porsche…now head the whole group….good succession planning in VW group
following VW’s current strategy of quickly want to market products and therefore never do enough testings, we shell see VW manufactured batteries one by one explode like how all the DSG koyak now. Using same methods will yield same results!
Who r u to question that..r u an engineer? Nissan R35 double clutch also koyak but not reported because how many R35 is on the road. VW Group is the most successful now, General Motors those days also not successful like this. Look at the brand under its wing from VW, Seat, Skoda, Audi, Porcshe, Bugatti, Ducati. And u, probably doing admin only want to question this kind of company.