Volkswagen Group is radically overhauling its enterprise technique to save cash and keep afloat, and it could axe its Tesla-inspired direct-to-consumer retail mannequin for EVs in main European markets.
In a press launch, VW stated 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 gradual 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 chargeable for gross sales, stated in an announcement. 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 instantly by way of its personal community of shops and on-line, has utterly disrupted the way in which through which vehicles are offered in Europe, with many legacy automakers making an attempt their greatest to observe swimsuit in a extremely regulated auto market. In VW’s case, its EVs might be bought by way of sellers, and the vendor earns a hard and fast, decrease margin with no need to tackle advertising prices or carrying prices for stock.
The potential 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 evaluation 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 1000’s of jobs and slashing pay for 10% of its remaining employees.
The model can be looking for to streamline manufacturing and growth 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 just a few months. The corporate introduced that it’s going to shut the manufacturing facility on February 28, 2025, with 3,000 staff dropping their jobs within the Brussels space.
Photograph credit score: Volkswagen Group
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