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 direct-to-consumer fashions whereas additionally promoting ICE autos through conventional retail operations was too complicated in Europe’s weak auto market, pointing to what it says is the sluggish tempo at which customers are shopping for EVs.
“Given difficult framework situations, we must reevaluate if our present company mannequin for all-electric autos delivers the very best buyer expertise,” Marco Schubert, the VW Group board member accountable 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 automobiles straight by its personal community of shops and on-line, has fully disrupted the way in which during which automobiles are offered in Europe, with many legacy automakers making an attempt their finest to comply with swimsuit in a extremely regulated auto market. In VW’s case, its EVs may be bought through sellers, and the supplier earns a set, decrease margin while not having to tackle advertising and marketing prices or carrying prices for stock.
The doable 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 assessment are anticipated to be launched in March of subsequent yr. VWs’s Cupra model, nevertheless, 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 reducing tens of hundreds of jobs and slashing pay for 10% of its remaining workers.
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, experiences 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 just a few months. The corporate introduced that it’s going to shut the manufacturing unit on February 28, 2025, with 3,000 staff shedding their jobs within the Brussels space.
Picture credit score: Volkswagen Group
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