VW speeds up work on small electric car

Bloomberg

Volkswagen AG is accelerating development of a compact electric car that will cost less than 30,000 euros ($35,800) as tightening emissions rules and generous subsidies bolster sales of battery-powered vehicles, according to people familiar with the matter.
The VW-branded car may be introduced as early as 2023, flanking the ID.5 crossover to be sold from next year as well as an electric iteration of the iconic hippie-era minibus slated for 2022, said the people, who asked not to be identified discussing internal plans.
VW is also working on a fully electric station wagon, dubbed Aero, with a battery range of as much as 700 kilometres (435 miles) to be sold from 2023, the people said.
The world’s best-selling automaker rolled out the ID.3 hatchback in Europe in September, its first vehicle based on underpinnings designed purely for battery-powered vehicles. The German manufacturer’s EV push will go global with the ID.4 SUV sibling next year, which will be produced in Europe, China and North America.
To free up funds for the industry’s biggest electric-car offensive, VW will take more steps to shrink its portfolio of combustion-engine cars after already culling models including the Beetle and the Scirocco.
It will discontinue the mid-sized Passat sedan in the US and sell only the station-wagon version in Europe, the people said. VW may also phase out the upscale Arteon coupe, they said.

Cost Cuts
The VW brand, which accounts for roughly half of the group’s deliveries, is stepping up efforts to cut costs and capital expenditures, including a fresh round of job reductions in Brazil. The business plans to reach break-even in South America and the US next year.
Even as the Covid-19 pandemic still weighs on several markets, VW’s order intake has been high, helped by surging demand for the hybrid versions of the high-volume Golf and Passat models.
The brand expects to gain market share during the fourth quarter and in 2021, according to the people. VW lifted its internal global market share target for next year to 8.6%, from 8.1% previously.

VW CEO has ‘old, encrusted’ structures left to break up
Bloomberg

Tensions at the top of Volkswagen AG are spilling over into public view, with the chief executive officer swiping at opponents within the company who stand in the way of making the massive carmaker more nimble.
In a German business newspaper op-ed, Herbert Diess likened VW to a “tanker” at a time when automakers’ survival depends on quickly pursuing electrification and digitalisation. He wrote that the company is highly influenced by labour unions who sometimes have different interests than shareholders.
“When I took office in Wolfsburg, I had firmly resolved to change the VW
system,” Diess wrote in Handelsblatt. “That means: breaking up old, encrusted structures and making the company more agile and modern.
Together with many companions with the same level of motivation, I have succeeded in doing this in many places, but not in some, especially not yet at our corporate headquarters in Wolfsburg.”
The latest call to speed up VW’s overhaul reflects the challenges Diess, 62, has had pushing through more dramatic reforms. He has struggled to win support from key stakeholders for his picks to fill top executive posts and floated the prospect of extending his contract before it would normally be up for renewal, people familiar with the matter said.
A fresh vote of confidence at VW’s regular supervisory board meeting next month could bolster his chances of making more radical changes. But if key stakeholders refuse to discuss his contract beyond 2023, Diess’s machinations could backfire. It’s more typical for extensions to be granted one year in advance of expiration.
VW officials including chairman Hans Dieter Poetsch and former German Chancellor Gerhard Schroeder praised the strong influence labour representatives have at the company in statements relating to an event celebrating 75 years of the so-called “co-determination” system.
The comment Diess submitted was more measured, referring to VW having “catch-up demand” with
regard to efficiency improvements. His comment in Handelsblatt about inflexible structures at VW’s headquarters echoed remarks supervisory board member Wolfgang Porsche made at the Geneva auto show last year, which disgruntled labour representatives. In a rare moment of candor, the leader of VW’s reclusive owner family criticised the amount of sway unions have over the company.
The changes sweeping the auto industry “will happen in the next ten years, with our without Volkswagen,” Diess wrote.