The Volkswagen Group is experiencing a moment of chaos. The house of Wolfsburg is one of the main players in the European automotive sector but it seems like a giant with feet of clay about to collapse. As you already know, the German brand They have focused a lot on the electrification of their rangeTo this end, the German group placed greater importance on the development of its own technology with investments that have not yet been recovered.
The sale of its electric vehicles has never been outstanding and the invasion of Chinese electric cars is not in their favour either. Added to this is the fact that the socio-economic situation does not help customers to renew their thermal cars to switch to electric ones. And now we are in this situation. It is said, it is commented, it is rumoured that Volkswagen could or would be Evaluating the idea of closing one or more factories in their own countryWe tell you what's happening.
Volkswagen has opted for electrification but it has not worked out very well…
As we have said before, and everyone knows, Volkswagen has bet heavily on electrification. With the ID family development They thought they were going to succeed but it has not been so. ID.3, ID.4 e ID.5 With added variants and sporty versions they have not been able to stand up to the MG4 o BYD DolphinThen they have their "cousins" from the Volkswagen Group with the Cupra Born and Skoda Enyaq, which in one way or another take away from their shine.
Lastly we have the ID.7 e ID Buzz two models that, due to their positioning and price, are far from everything that customers are looking for and need. No, we are not saying that they are all bad models (far from it) but in a market that is still in its infancy The price-autonomy factor is vitalAnd today, the electric models offered by Volkswagen are far from what MG or BYD present, along with the long list of Chinese rivals.
Considering that the electric business is not going as it should, The brand is taking steps to prevent its finances from sufferingIf we look back, we must remember what the sector was like just before Covid-19 came into our lives. Work was done in large volumes and therefore the companies had gigantic factories that today, after the collapse of the sector, they are not able to fill because no cars are sold.
Well, Volkswagen It is one of those brands that has factories that do not reach the minimum capacity for optimal operation. And now that it is going through a bad economic moment, the need has been put on the table to see which ones are operating at a lower performance in order to close them down. All of this, like a desperate lifeline to the cutback plan that the brand introduced a few months ago and that is not working for them.
And now it needs to cut costs to balance its accounts…
Thanks to our colleagues at Autocar we have learned that Volkswagen is evaluating the situation of several centres where it assembles low-volume models. First of all, there is the Dresden city centre known as the transparent factory and was inaugurated in 2002 for the Phaeton. Today the ID.3 is assembled there and due to its poor numbers, it could be a strong candidate to close its doors and move to another factory.
Second is the Osnabrück factory. Three models are manufactured here which, although not a priori successful, their volumes would not justify having a factory exclusively for them. These are the Porsche 718 Boxster and Porsche 718 Cayman in association with the Volkswagen T-Roc Cabrio. In fact, sales of the latter so far this year at European level stand at just over 6.100 units, making it the most popular convertible in all of Europe.
Whatever the case, the situation for Volkswagen and its parent group is complicated to say the least. On the one hand, they are an institution in their home country and closing factories on home soil would not give them a good image in their largest market. And their problems do not end there because there would be a Occupational Safety Plan in force since 1994 that would not approve the closure of its factories and layoffs in the country until 2029, which the IG Metall union is already denouncing.
We will have to keep an eye on the news as it happens, but Volkswagen CEO Thomas Schafer told German media that the situation was "extremely tense and could not be overcome with simple cost-cutting measures". We'll see what happens...
Source - Coach
Images | Volkswagen – Porsche
