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 complicated 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 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 vehicles straight by way of its personal community of shops and on-line, has fully disrupted the way in which wherein vehicles are offered in Europe, with many legacy automakers making an attempt their greatest to observe go well with in a extremely regulated auto market. In VW’s case, its EVs will be bought by way of sellers, and the vendor earns a set, 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 assessment are anticipated to be launched in March of subsequent yr. VWs’s Cupra model, nevertheless, will proceed to sells its EV beneath 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 chopping tens of hundreds of jobs and slashing pay for 10% of its remaining employees.
The model can also be in search of to streamline manufacturing and improvement processes, shaving off months on the event cycles of particular initiatives to assist tighten the belt, studies 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’ll shut the manufacturing facility on February 28, 2025, with 3,000 employees dropping their jobs within the Brussels space.
Photograph credit score: Volkswagen Group
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