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Volkswagen & its future, India & beyond

Written by Nizam Shaikh

Volkswagen has announced the brand’s new transformation strategy called ‘Accelerate’ which comes with four key elements – Electrification, Software Defined Product, New Business Models and Autonomous Driving. The new Accelerate strategy will help the brand transform into a software-driven mobility provider. The new strategy will also help Volkswagen integrate software into the vehicle as a digital customer experience becomes more crucial in the future. With a Data-based model, Volkswagen also plans to attract new groups of customers tapping additional sources of income. By the end of 2030, Volkswagen will also make autonomous driving available to a wide range of customers and “E-mobility was just the beginning”, says Ralf Brandstätter, CEO of Volkswagen.

Software Integration

With the rise in volumes, software integration becomes necessary as digital customer experience will become the core competency of the Group. For this the ID. family will be receiving over-the-air software updates every 12 weeks under the ID. Digital agile project unit, starting this summer. This will enable the vehicle to remain up-to-date and even become better over its life cycle adding new functions through the updates. The brand expects to have over 500,000 vehicles in two years time which will be networked and transmit direct customer feedback.

Business model 2.0

Under the new business model, Volkswagen is setting a scene to turn the vehicle into a software-based product. With data-based models, Volkswagen will be offering attractive service packages for the customers, lowering the entry-level barriers. The brand will generate revenue through the service life of the vehicle via charging and energy services that the customers are able to reserve through automated functions and software-based functions.

Profitability Plan

Through ‘Accelerate’ Volkswagen plans to systematically work on increasing its efficiency with a target of operating margin of at least 6% by 2023 and to secure it in the long term as well. The Group has allocated 16 billion euros for investment up to the year 2025 for e-mobility, hybridization and digitalization. The brand will be focussing on becoming more resilient to market fluctuations and the company attempting to trim its fixed costs by 5% before 2023.

E-Mobility Expansion

The brand once again plans to accelerate the expansion of e-mobility solutions with a global e-campaign. Volkswagen plans to increase its market share to over 70% of deliveries of all-electric cars in the European market and by 50% in the United States and China by 2030. The brand has announced that it will be bringing out at least one new BEV model every year to achieve this plan. Volkswagen will also optimize the Modular Electric Drive Toolkit (MEB) in a continuous manner to improve the acceleration, charging capacity and range of the platform. Also, under the brand’s flagship Trinity project, Volkswagen will deploy the next-generation high-performance all-electric drive and scalable systems by 2026.