1
NEWS
VW faces hurdles on way to number one
Production issues obstruct VW's plans to outsell GM and Toyota by 2018A combination of technical difficulties and workforce recalcitrance stands in the way of Volkswagen's push to be the largest selling car company in the world by 2018, according to a report in authoritative industry journal, Automotive News Europe.
For some years Volkswagen has been committed to being top of the heap, but recent cost-cutting announcements and staff turnover, allied with difficulties implementing production changes for the MQB modular platform have brewed up a perfect storm of events all converging at a less than ideal time for VW.
Automotive News Europe (ANE) cites an anecdote concerning production of the e-Golf at the Wolfsburg plant. Because the EV failed to measure up in US crash safety testing, the electric Golf was rapidly re-engineered with a stiffer frame to make the cut. Unfortunately there was no room on the production line for the extra robots required to carry out the additional production procedure – leaving VW no choice but to jury-rig a process by which workers manually transported the sheet metal to the robots on the production line.
Against this background of worker unrest – not seen since a decade ago when the company axed 20,000 jobs in Germany – Volkswagen is also facing lower operating profits, which are down by a third. That is due in part to the weaker US dollar, but is also a symptom of a cost blow-out implementing the production of vehicles built on the MQB platform (Golf, A3 and Octavia, to name three).
As ANE says of the 'ambitious' MQB program, it has the potential to cut costs and improve efficiencies, but once something goes amiss – as in the case of the e-Golf – it has wide-ranging repercussions for the entire production process across several models rather than just one or two. Wolfsburg is believed to be capable of building as many as 2000 cars a day, and the company plans for as many as four million cars to be eventually built off the MQB platform. To be number one the company has to be hitting a production peak of 10 million or more a year. A flaw in MQB vehicle production could have significant and lasting ill effects on total output.
While some VW sources have informed ANE that the problem rests with the complexity of the MQB platform strategy, others blame the workforce, with Wolfsburg described in the report as a "bastion of unionised labour."
Volkswagen CEO, Martin Winterkorn has previously announced €5 billion worth of cost cutting, but he is yet to reveal the exact nature of those cuts.
"We have a lot of catching-up to do with our core competitors. That is why we must now take action that is clear, effective and sometimes painful," Winterkorn told managers at a conference in mid-July. His remarks received a swift response from Bern Osterloh, representing Volkswagen's workforce. Osterloh said that the "sparks will really fly" if Volkswagen is not careful. The steward is not known for being so outspoken.
Share this article
Written byCarsales Staff
See all articlesOur team of independent expert car reviewers and journalistsMeet the team
Stay up to dateBecome a carsales member and get the latest news, reviews and advice straight to your inbox.
Subscribe todaySell your car with Instant Offer™
Like trade-in but price is regularly higher
1. Get a free Instant Offer™ online in minutes2. An official local dealer will inspect your car3. Finalise the details and get paid the next business day
Get a free Instant Offer
Related articles
Disclaimer
Please see our Editorial Guidelines & Code of Ethics (including for more information about sponsored content and paid events). The information published on this website is of a general nature only and doesn’t consider your particular circumstances or needs.
Please see our Editorial Guidelines & Code of Ethics (including for more information about sponsored content and paid events). The information published on this website is of a general nature only and doesn’t consider your particular circumstances or needs.
Love every move.
Buy it. Sell it.Love it.
®Contact
Advertise with us
Local marketplaces
International marketplaces
Scan to download the carsales app
Want more info? Here’s our app landing page
App Store and the Apple logo are trademarks of Apple Inc. Google Play and the Google Play logo
are trademarks of Google LLC.