Volkswagen to focus on profits, slash ICE range

Far more worthwhile autos, and much less versions with internal combustion engines: that’s the plan for the Volkswagen Team over the up coming decade.

In an job interview with the Fiscal Occasions, Arno Antlitz, the Volkswagen Group’s chief financial officer (CFO), claimed the automaker plans to cut down its European variety of vehicles with petrol and diesel engines by 60 per cent by 2030.

Across its lots of models, the automaker now delivers in Europe all over 70 versions and physique type variants with interior combustion engines (ICE).

Over the final couple of a long time it has invested billions on billions of euros in new models driving on EV-only architectures.

The European Commission programs on banning the sale of new autos with petrol, diesel, hybrid and plug-in hybrid drivetrains by 2035. To speed up the changeover European governments are also providing tax and other incentives to EV purchasers.

The CFO also mentioned, “We are [more focused] on quality and on margins, rather than on volume and current market share”.

This marks a turnaround from the era under previous CEO Martin Winterkorn among 2007 and 2015 when the automaker actively chased quantity in pursuit of being the world’s largest automaker.

Winterkorn resigned right after news of the Dieselgate scandal broke in late 2015.

Evidently, the latest approach to place profits in excess of volume is the consequence of the global semiconductor lack, which has triggered automakers of all stripes to quickly near factories and scale back creation.

Mercedes-Benz, for occasion, observed product sales tumble by above five for each cent in 2021 but, simply because it prioritised a lot more high priced and lucrative styles, the firm booked a document gain before fascination tax of €14 billion ($20 billion).

Which is much more than double the €6.8 billion ($10 billion) it built in 2020 and €6.2 billion ($9 billion) it banked in 2019.

Similarly the Volkswagen Team saved Audi product sales continuous and grew Porsche by around 10 for each cent. According to the business newspaper the German company managed to make all around €20 billion ($29 billion) in pre-tax revenue despite sales falling 5.5 for every cent to 8.6 million.

It need to be observed, Volkswagen isn’t the 1st mass-market automotive team to change its awareness to per-device profit relatively than total profits volume. Groupe PSA — now element of Stellantis — turned by itself about by carrying out this less than the leadership of CEO Carlos Tavares, and Luca de Meo is hoping to do the exact same at the Renault Team.

Antlitz mentioned the automaker will not be including more production ability as Volkswagen shifts its focus to electric powered motor vehicles in Europe and other created markets.

As with the Zwickau and Emden factories in Germany, Volkswagen will transform existing amenities from earning ICE automobiles to EVs.

Extra: Who won the world automotive revenue race in 2021?