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VW CEO Martin Winterkorn has made a pledge to close the gap between Toyota and VW. The automaker has set a goal of ten years to catch up to Toyota in terms of productivity and profit. Porsche CEO Wendelin Wiedeking also backs the plan. Wiedeking sees Toyota as the benchmark.
Porsche currently holds a 31% stake in VW, but there are rumors that the percentage could increase to 51%.
The 10-year plan is likely to be similar to the plan Winterkorn instilled when he was CEO of Audi. The target for the financial and sales goals has been set to 2018.
Do you think it is possible?
Full Story: Motor Authority
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Comments (20)
hmmm... seeing as everyone kind of clings to toyota for reliability and everyone on here seems to hate VW for their lack of reliability I doubt it. However 10 years is plenty of time to turn themselves around, at the very least I think they'd be able to accomplish quite a bit :)
Posted by Draz | September 3, 2007 4:40 PM
Posted on September 3, 2007 16:40
However 10 years is plenty of time to turn themselves around, at the very least I think they'd be able to accomplish quite a bit :)
Sure, as long as they keep pumping out the those Mac'esque commercials all the "sheep" will allow them to reap huge profits.
The four people I've known with "Vdubs" (all 2000+ models) said they'll never buy one again. From automatic tranmission problems, turbos failing after 20k miles and various electrical gremlins. The two who bought pre-owned cars just outside of warranty coverage had it really bad $$$$.
Posted by Noya | September 4, 2007 12:07 AM
Posted on September 4, 2007 00:07
VW has been plagued by some reliability issues recently, however it seems to be hit or miss. Noya points out he (she?) knows plenty of people who have been hit by a few problems, but then again I personally know people who swear by the reliability of recent VW models (and then again, I too know people who would say that about any brand).
The perception that its lacking quality is the big problem, but the first step to fixing it is to improve the quality of the cars. VW could launch an ad campaign and not change a thing, but that would just make people complain louder when there was a problem.
And to match it in profitability, they cannot just increase the price of the cars. They already tried to move VW to a luxury brand and step all over Audi, but we all know that the Phaeton failed to sell despite how good of auto it was. Volkswagen needs to try and seize what margin it can on the cars, and I do not recommend it just try and make them cheaper. Instead, convince people to accessorize. You know that Mini reaps in tons of cash on all the little stuff people buy for their Mini's at the dealership: there is your entrance.
Try this: offer to put speakers that work independent of the main stereo in the lift gate of the hatchback models. Chrysler made an error in offering this standard in all of a certain level of the Caliber: it was not such a big deal to most people, but you can bet there would of been people who would of shelled out the money themselves to had the system installed at the dealer. This saves the cost of putting it on every car, and increases margins.
Also, finding a way to offer Diesel models at a more attractive price is a good way to take a slice of Toyota's market share. If people have to pay a grand or more extra for a diesel, its going to push some of them away. But $800 more? Or a grand flat? Done, people will come then.
Also, VW is seen kind of as a poor yuppies car, or a young persons car, or a spoiled kids car. Not that professional people would not buy them, or that normal people would not buy them, or that any of those three categories still do not spend money. But, it'd be better of the connotations those three labels carry were not so closely aligned with VW.
Posted by Allen | September 4, 2007 12:42 AM
Posted on September 4, 2007 00:42
VW think that Toyota will sleep for 10 years?
Posted by RETNIAP | September 4, 2007 7:14 AM
Posted on September 4, 2007 07:14
I love VW's design, I think they are nice lookin cars, hell, most of the German makes are fantastic looking cars. I would like to know why it is only the Japs that can get electronics?
One thing the Germans have a bad rep for, even Mercedes, is poor electronics in the cars.
Really thought hard about a Passat TDI awhile ago, got a toyota instead. The toyota has needed nothing in the 40K I have put on it so far.
Posted by zipppy | September 4, 2007 7:32 AM
Posted on September 4, 2007 07:32
WV might catch Toyota which is struggling with getting any better than it is currently. WV and Toyota will be overpassed by the Koreans.
Laugh all you want but in reliability they are up there, when they grasp that electric engines are the way of the future and that interiors also need quality design and materials they will be hard to match.
And while Chinese are at a stage where they are crap, in 15 years that shoudl change dramatically.
As for brands in general. I could not care less. A solidly built electric powered sedan with good range is all I will be looking at in the following years.
Posted by Diesel | September 4, 2007 7:57 AM
Posted on September 4, 2007 07:57
i find this quite humorous.
Posted by bc | September 4, 2007 9:08 AM
Posted on September 4, 2007 09:08
You can. Given current circumstances that is quite normal. But for electric vehicles you no longer need to be a corporation. They are much simpler, far less reliability issues etc..
Much more like scooter or moped manufacturing. Hundreds if not thousands of makers across the globe can make them in the future. And you can bet that there will be many niches covered. Ultra luxury and everday commute versions.
With internal combustion and hybrids you need massive R&D, marketing, distribution, aftermarket care.. and with more standardized electric powerplants, batteries,.. you will be able to do almost anything you want. Upgrade the power, batteries or whatever.
Today's cars are overy complicated and not that impressive. Who needs all the moving parts and all the crap that it in them?
Electricity makes it much more simple and lowers entry barriers.
Asians do have the advantage in costs, more and more of them can afford quality design studios for design etc.. so it is more or less a matter of time for these things.
You can expect to be purchasing cars like that at Walmart in maybe as little as 10 years.
Posted by Diesel | September 4, 2007 12:55 PM
Posted on September 4, 2007 12:55
I think that it is a mistake to focus on Toyota and let Toyota define the game for them. This means that they have already lost.
Truely innovative and successful companies define or redefine the rules; rather than play "me too". Volvo should be trying to set its own innovative course instead of trying to snag onto Toyota's bumper.
Posted by jake | September 4, 2007 1:29 PM
Posted on September 4, 2007 13:29
I think that it is a mistake to focus on Toyota and let Toyota define the game for them. This means that they have already lost.
Truely innovative and successful companies define or redefine the rules; rather than play "me too". VW should be trying to set its own innovative course instead of trying to snag onto Toyota's bumper.
Posted by jake | September 4, 2007 1:29 PM
Posted on September 4, 2007 13:29
jake said it right: changing the game is better than playing the game. You know why GM, Ford and Chrysler are failing and/or having troubles? Because they are always playing catch up to Toyota, Honda and Nissan.
If they could move away from large V8 boats (already a loosing game) and then create some genuinely good designs with original powerplants, then they'd have a base to build a new legacy on.
Posted by Allen | September 4, 2007 4:18 PM
Posted on September 4, 2007 16:18
This is utterly ridiculous. Not more than a month or so ago VW was pondering pulling out of the US market altogether. Now they are strategizing to over take Toyota? Huh! VW might have a 10 year plan, but the Japanese automakers have a 50 year plan. The Japanese makers are notorious for looking 50 or 100 years ahead. This is something the US makers had better understand. US makers are lucky to look to the next quarter of the stock return for their planning. VW is kidding themselves by targeting Toyota. They’d be lucky to even catch Subaru or Nissan.
Posted by John Campi | September 4, 2007 5:51 PM
Posted on September 4, 2007 17:51
This is utterly ridiculous. Not more than a month or so ago VW was pondering pulling out of the US market altogether. Now they are strategizing to over take Toyota? Huh! VW might have a 10 year plan, but the Japanese automakers have a 50 year plan. The Japanese makers are notorious for looking 50 or 100 years ahead. This is something the US makers had better understand. US makers are lucky to look to the next quarter of the stock return for their planning. VW is kidding themselves by targeting Toyota. They’d be lucky to even catch Subaru or Nissan.
Posted by John Campi | September 4, 2007 5:52 PM
Posted on September 4, 2007 17:52
Shoot for the stars... but you are going to come up short. Someone obviously was listening to their elementary teacher when they said that you can be anything and do anything if you put your mind to it.
Haha... catch up to Toyota in 10 years.
Don't get me wrong, I love my VW TDi, but there is no way that VW can compete with the likes of Toyota. As said above, why not shoot for Subaru..?
Posted by ryan | September 5, 2007 2:38 AM
Posted on September 5, 2007 02:38
To catch up to Toyota, build your products like Toyota. People ain't kidding when they complain VWs fall apart and praise Toyotas for being tanks - Having owned VWs, Audis, Hondas and Toyotas I can attest to that.
Posted by Val | September 5, 2007 10:49 AM
Posted on September 5, 2007 10:49
the 10 years are to catch up in productivity and profitability.....
At this galacial pace, even Geely will have overtaken them.
Maybe a bit of focus should help? No more Pheaton, get rid of Bentley, sell Lambo, close SEAT?
Then the managers can focus: catch-up in quality and catch-up in hybrids. A Diesel-hybrid could turn the tables for VW....
Posted by rene | September 6, 2007 12:40 PM
Posted on September 6, 2007 12:40
"And to match it in profitability, they cannot just increase the price of the cars. They already tried to move VW to a luxury brand and step all over Audi, but we all know that the Phaeton failed to sell despite how good of auto it was."
AUDI is a fully owned VW company.
"You can. Given current circumstances that is quite normal. But for electric vehicles you no longer need to be a corporation. They are much simpler, far less reliability issues etc.."
You mean far more reliability issues, because of the increased complexity of design, and use of materials not as durable as good old iron metals.
Bottom line is the VW is partly owned by Government and Porsche. As long as there is this powerstructure, conflict of interest makes any real decision making hard. This trickles all the way down to the production floor. Also because of very powerful work unions, which have way to much influence and power in the German corporate structure, achieving such goals is doubtful. Having goals is nice, but getting the job done is something completely different.
Posted by Car-buff | September 7, 2007 12:02 AM
Posted on September 7, 2007 00:02
Car-buff,
thats an interesting insight you have there. Do you think that because the value will move to the electric moter/battery guys, the business system will change, hence have consequences for car companies?
Thanks
Posted by rene | September 7, 2007 10:14 PM
Posted on September 7, 2007 22:14
At least VW has a goal. What is the goal of Chevy or Ford? To keep from totally going under?
Posted by CS | September 10, 2007 12:40 PM
Posted on September 10, 2007 12:40
vw has most of the Chinese market.The next biggest car market in the world.Toyota doesn't sell well in China because it is a Japanese car.China has a anti-japan attitude I think.They rather buy German than japanese. So if Vw has control of Europe and China.Toyota only has japan and North America.
Posted by Aikawa | November 25, 2007 1:47 AM
Posted on November 25, 2007 01:47