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 via direct-to-consumer fashions whereas additionally promoting ICE autos through conventional retail operations was too advanced in Europe’s weak auto market, pointing to what it says is the gradual tempo at which customers are shopping for EVs.
“Given difficult framework circumstances, we should reevaluate if our present company mannequin for all-electric autos delivers the very best buyer expertise,” Marco Schubert, the VW Group board member liable 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 automobiles immediately via its personal community of shops and on-line, has utterly disrupted the way in which wherein automobiles are bought in Europe, with many legacy automakers making an attempt their finest to observe go well with in a extremely regulated auto market. In VW’s case, its EVs might be bought through sellers, and the vendor earns a set, decrease margin without having to tackle advertising and marketing prices or carrying prices for stock.
The potential retail revamp consists of VW model autos but in addition 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 evaluate are anticipated to be launched in March of subsequent yr. VWs’s Cupra model, nevertheless, will proceed to sells its EV underneath the direct-to-consumer mannequin, as will all VW autos bought 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 looking for to streamline manufacturing and improvement processes, shaving off months on the event cycles of particular tasks 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 number of 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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