Volkswagen Group is radically overhauling its enterprise technique to economize 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 mentioned 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 shoppers 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 liable for gross sales, mentioned 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 straight via its personal community of shops and on-line, has utterly disrupted the best way wherein vehicles are bought in Europe, with many legacy automakers attempting their greatest to observe swimsuit in a extremely regulated auto market. In VW’s case, its EVs might be bought through sellers, and the supplier earns a set, decrease margin without having to tackle advertising 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 evaluate 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 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 workers.
The model can also 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 a couple of months. The corporate introduced that it’ll shut the manufacturing unit on February 28, 2025, with 3,000 employees dropping their jobs within the Brussels space.
Picture credit score: Volkswagen Group
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