Background and Context
The Volkswagen Group is now entering the next phase of transformation. Over the past three years, the Group has structurally realigned itself on the basis of its Top-10 programs and undergone a technological overhaul, accompanied by performance programs across all brands and Group companies. Key targets across products, technology and regions have been met – in some cases ahead of schedule. This was achieved despite massive geopolitical and external financial headwinds, which were largely offset.
Over the past twelve months, the global situation has continued to change dramatically. Geopolitical tensions, rising costs – driven primarily by tariffs – growing regulatory requirements and an increasingly intense global competitive environment have compounded the challenges facing the automotive industry in an already far-reaching phase of transformation.
Overview: Future Plan for the Next Phase of Transformation
The Executive Board of the Volkswagen Group is continuing the strategic realignment of the company to sustainably strengthen its competitiveness. The Executive Board presented the Supervisory Board with a comprehensive package of measures comprising 12 initiatives and the 2030 target picture. In the global market environment, it is essential to make the company even more resilient, efficient and agile. The Executive Board has already begun implementing initial measures of its future plan.
Streamlined Model Lineup and Reduced Offering Complexity
The model lineup will be gradually streamlined by up to 50 percent and concentrated on the most attractive market segments. Offering complexity – for example, the number of available equipment options – will be reduced by up to 75 percent. This allows investments and development resources to be focused on the products and technologies that deliver the greatest added value for customers and the highest value contribution to the Group.
Harmonized Technology Fields
The key technology fields of platforms, electronic architectures and software landscapes will each be harmonized and concentrated to meet the requirements of the western and eastern hemispheres respectively. The objective is to realize Group-wide synergies more effectively, eliminate technological parallel structures, and further strengthen technology leadership. To this end, the Volkswagen Group is focusing on competitive technologies with high scaling potential and clear customer benefit.
Adjusted Technical Capacities
By further streamlining its technical capacities, the Group is aligning its production network with the changed market environment and sharply intensified competition. The cross-brand target is a demand-appropriate level of approximately 9 million units per year. Prior to the COVID-19 pandemic, the company had invested for approximately 12 million vehicles and has already made significant progress with a reduction of 2 million units. Further steps will follow in China and Europe.
In parallel, development and indirect functions are being made more efficient. Digitalization, artificial intelligence and shared services will help increase productivity and speed. Leaner management structures are simplifying decision-making processes.
Focus on the Automotive Core Business
The Volkswagen Group is focusing on its automotive core business. The equity and investment portfolio is being aligned with strategic contribution, return and capital commitment – with the objective of achieving greater focus, lower complexity and additional financial flexibility.
Strengthened Competitiveness
The comprehensive package of measures will further improve the Volkswagen Group's resilient position during a demanding period of global transformation for the automotive industry. Strengthening the Group's own competitiveness is at the same time a contribution to the future of Germany as an industrial location. With a successful transformation, the Volkswagen Group will build the foundation for growth, investment and sustainable value creation.
