Volkswagen Group is radically overhauling its enterprise technique to economize and keep afloat, and it might axe its Tesla-inspired direct-to-consumer retail mannequin for EVs in main European markets.
In a press launch, VW mentioned that promoting EVs by way of direct-to-consumer fashions whereas additionally promoting ICE autos by way of conventional retail operations was too advanced in Europe’s weak auto market, pointing to what it says is the sluggish tempo at which shoppers are shopping for EVs.
“Given difficult framework circumstances, we must reevaluate if our present company mannequin for all-electric autos delivers the absolute best buyer expertise,” Marco Schubert, the VW Group board member answerable for gross sales, mentioned in a press release. Nonetheless, he added that direct-to-consumer gross sales will stay a “long-term goal” for the automaker.
Tesla’s revolutionary direct-to-consumer mannequin, which bypasses conventional dealerships in favor of promoting vehicles immediately by way of its personal community of shops and on-line, has utterly disrupted the best way through which vehicles are offered in Europe, with many legacy automakers making an attempt their greatest to comply with go well with in a extremely regulated auto market. In VW’s case, its EVs could be bought by way of sellers, and the supplier earns a hard and fast, decrease margin without having to tackle advertising and marketing prices or carrying prices for stock.
The attainable retail revamp consists of VW model autos but additionally Audi, Skoda, and VW business autos in France, Germany, Poland, Spain, and the UK.
In 2020, VW launched its direct-sales mannequin for EVs, and the outcomes from its overview are anticipated to be launched in March of subsequent 12 months. VWs’s Cupra model, nonetheless, will proceed to sells its EV below the direct-to-consumer mannequin, as will all VW autos offered in Eire and Sweden, no matter drivetrain.
This comes at a time when VW is radically restructuring its enterprise to chop prices, and plans to shut down three factories in Germany – the primary time within the firm’s 87-year historical past that it’s closing factories on its dwelling turf. The plan consists of slicing tens of hundreds of jobs and slashing pay for 10% of its remaining employees.
The model can also be searching for to streamline manufacturing and improvement processes, shaving off months on the event cycles of particular initiatives to assist tighten the belt, reviews Automotive Information Europe.
VW is closing its Audi plant in Brussels the place it makes soon-to-be-retired Audi Q8 E-Tron – an €80,000 electrical SUV that suffered from low gross sales – in a couple of months. The corporate introduced that it’s going to shut the manufacturing unit on February 28, 2025, with 3,000 staff dropping their jobs within the Brussels space.
Picture credit score: Volkswagen Group
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