One of the reasons for Volkswagen’s current strength dates back four years. During the carmageddon of 2008 ff, multinational carmakers such as GM and Toyota drastically cut back investments into new cars and technologies. Volkswagen did not change R&D spending. Four years later, this translates into a host of new models, and revolutionary platform architectures (MQB, MLB, MSB) that promise even more new models at lower cost.
Faced with the European edition of carmageddon, Volkswagen won’t lower spending either. Instead, it will increase investments into new cars and factories, Reuters says.
Tomorrow, Volkswagen’s supervisory board is expected to sign off on new spending targets for the 2013-17 period.
Reuters expects Volkswagen to increase spending by 12 percent to as much as 70 billion euros ($89.73 billion) for its twelve brands over the next five years, after the spending target was raised 20.9 percent to 62.4 billion euros for the 2011-15 period.
This could be another nail in the coffins of Peugeot and Fiat, which have slowed or shelved whole vehicle programs, engine technologies and platform revamps.