Volkswagen Chickens Out, Says Strategy 2018 Is Old Hat, Declares Victory, Goes Home

Bertel Schmitt
by Bertel Schmitt

In 2007, when Martin Winterkorn took over as CEO of Volkswagen, he said that Volkswagen wants to be better than Toyota, not just in units, but in profitability, innovation, customer satisfaction, everything. This morphed into the “Strategie 2018”, which called for world domination no later than what the name says. Today, Volkswagen changed its mind. Declaring an early victory, it wants to move on.

Volkswagen’s top managers already are working on some sort of a Strategie 2022, “as steady volume gains have already propelled the German group within reach of its current sales target for 2018,” says Reuters. Volkswagen’s labor chief Bernd Osterloh agrees: “We definitely need a new growth strategy.” Preferably one that does not include Toyota.

World’s Largest AutomakersFull Year 2012 Data12M ’1212M ’11YoYToyota9,909,4407,858,09126.1%GM9,288,2779,023,5022.9%Volkswagen9,070,0008,160,00011.2%Source: Company data.Toyota: Production. GM: Sales. VW: Deliveries.

Readers of TTAC know ( ad nauseam, some will say) that Volkswagen ended the year 2012 with 9.07 million units delivered, putting in in rank three behind Toyota and GM. Didn’t they want to be the biggest? Now, the target miraculously morphed to 10 million units, a number Toyota missed by a hair last year. This year, the 10 million are in at least theoretical reach of all of the top three. Despite having been given (very long) odds by TTAC to break the 10 million barrier this year, Osterloh thinks it won’t happen, and we think he’s probably right. However, Osterloh says Volkswagen “must consider whether 2018 is still the appropriate standard.”

Interesting. Actually, 10 million never was the goal. The goal was, as related to me by a Volkswagen top executive who was in the meetings, to be better than Toyota, not just in units, but in profitability, innovation, customer satisfaction, everything, no later than 2018. In 2011, the goal looked near: Not Winterkorn, but a giant floodwave had stopped Toyota, half a year later, torrential rains in Thailand drowned Toyota again. Volkswagen wasn’t ready to exploit the situation, instead, GM became #1. Now, Toyota is back, and looking stronger than ever. Meanwhile, Volkswagen is faced with a little trouble at home. I don’t blame Volkswagen for ditching the plan. Actually, I always wondered why Volkswagen would “do what CYA-trained managers usually are loath to do: Set bold and measurable targets.”


Bertel Schmitt
Bertel Schmitt

Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.

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  • Oldyak Oldyak on Feb 01, 2013

    You think the "customer satisfaction" part could have made VW rethink????

  • Oelmotor Oelmotor on Feb 01, 2013

    VW forgot about two factors. Quality and the meaning of "Volkswagen." I would take a Dacia over their expensive garbage.

  • AZFelix Hilux technical, preferably with a swivel mount.
  • ToolGuy This is the kind of thing you get when you give people faster internet.
  • ToolGuy North America is already the greatest country on the planet, and I have learned to be careful about what I wish for in terms of making changes. I mean, if Greenland wants to buy JDM vehicles, isn't that for the Danes to decide?
  • ToolGuy Once again my home did not catch on fire and my fire extinguisher(s) stayed in the closet, unused. I guess I threw my money away on fire extinguishers.(And by fire extinguishers I mean nuclear missiles.)
  • Carson D The UAW has succeeded in organizing a US VW plant before. There's a reason they don't teach history in the schools any longer. People wouldn't make the same mistakes.
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