Editorial: VeeDub Rules Ze Vorld?

Bertel Schmitt
by Bertel Schmitt
editorial veedub rules ze vorld

In November 2007, VeeDub head honcho Martin Winterkorn announced his version of the Schlieffen Plan. Dubbed “Strategie 2018,” Winterkorn plotted the overthrow of GM and Toyota from the top of the worldwide sales charts. Winterkorn called for VW to rule the world in sales, profits, innovation and customer satisfaction by 2018. When the plan was announced, the MSM feted it, insiders (this reporter included) rolled their eyes and denounced the announcement as the usual hubris of an incoming CEO, a suit who’d be busy collecting his pension by the time 2018 rolled around. In any case, by 2018, the Generalstabsplan would long be forgotten and superseded by at least five other grand strategies.

A month ago, the worker’s council at Volkswagen said that the plan has merit. “All at Volkswagen agree that the targets of Strategie 2018 haven’t changed and that we will reach them,” said workers council chief Bernd Osterloh. That story didn’t get much traction. The few who read it sighed. Through plain dumb luck and the incompetence of others, VW may be closer to “mission accomplished” than anybody dared to think.

It’s a done deal: VW will surpass GM in sales this year to become world number two, behind Toyota. Now, Reuters reports that “Volkswagen AG may have overtaken Toyota Motor Co to become the world’s top-selling carmaker in the first quarter, thanks to government incentives that fueled demand in VW’s major markets.”

VW’s overall deliveries to customers worldwide fell 11 percent to around 1.39m vehicles in Q1. Others fell faster and harder, enabling VW to increase its share of the global passenger car market by 130 basis points to 11.0 percent.

“Toyota has given no forecast for retail sales, but its latest estimate for shipments for the 2009 first quarter is 1.23m vehicles, down 47 percent from a year earlier,” Reuters says.

“Volkswagen has the luck of being strong in the markets that are currently growing, while Toyota is exposed to those that are collapsing,” says motor mouth Ferdinand Dudenhoeffer in a rare case of seeing the obvious. VW’s failure to get anywhere in the toxic US market is now its savior. Where you have no significant sales, you cannot have significant losses.

Volkswagen has a very strong position in the world’s only significant growth market, China. In the PRC, VW surpassed the 1m mark last year. It produced more cars in China than Germany. Toyota has seen sales fall every month of this year in China, its third-biggest market. Volkswagen is benefiting from government stimulus plans for the car industry that have boosted demand in Germany, China and Brazil, its three biggest markets that together accounted for half of all group sales in the first quarter.

While VW is lucky to be in the right place at the right time, Toyota definitely finds itself in the wrong places at the wrong time: Toyota’s first-quarter US sales fell 36 percent, while sales in Japan for the core Toyota brand plummeted 31 percent. The two markets account for just under half of its global sales.

Volkswagen China’s Winfried Vahland quickly positioned himself as the top general in Volkswagen’s audacious plan to subjugate Toyota. “We have launched Strategy 2018 in line with the long-term objectives of the Volkswagen Group in China,” Vahland said to China Daily. Note the “We have launched.” Vahland said he would increase annual vehicles sales in China from the current 1 to 2 million units as well as enlarging its fleet by least four models per year by 2018.

The former controller, Vahland, had an uneventful career at VW and his dispatch to Beijing as head of the Volkswagen Group in Beijing was widely seen as a promotion to Volkswagen’s Siberia. The real power centers of VW China are at SAIC in Shanghai and FAW in Changchun. Now, Vahland basks in the limelight of being the frontline general of Volkswagen’s attack on a weakened Japan.

In Germany, VW benefited from the Abwrackprämien boom. Deliveries rose 4.5 percent to about 251,500 vehicles during the quarter. More than 160,000 new orders were booked as owners turn in their clunkers for a new one and €2.5K from the government.

Even in cratering Russia VW grows. Despite a 39 percent contraction in overall Russian demand, Volkswagen grew its volume by 14 percent, making VW the fourth-largest manufacturer in the country.

NPR can’t believe their ears: “Come on? Volkswagen? The world’s top selling automaker? That sounds impossible. Last year, Toyota crushed VW, selling almost three million more cars and trucks. But in the first quarter, Volkswagen sold more vehicles than Toyota even estimates it shipped. Analyst John Wolkonowicz at IHS Global Insight calls it a fluke.”

The disturbing news of the arrival of the former axis member at the gates of Aichi, Nagoya, results in grave head-nodding in the land of the rising sun. “Volkswagen is a big competitor for Toyota,” said Koji Endo, auto analyst at Credit Suisse in Tokyo. “Audi is strong, Volkswagen is strong, and they’re making good use of their small cars.”

The stock market greeted the news by lifting VW’s tock price. VW has also moved up in stock value ranking, grabbing the No. 2 spot behind Toyota, whose market capitalization of $133b still outstrips the German carmaker’s $100b. For now.

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  • Tparkit Tparkit on Apr 19, 2009

    Schmitt, you are either ignorant of human history, or gained nothing from it. In this you have much company, but some of these people recover. Steven Spielberg said that, after he learned something about Nazis, he regretted using them for entertainment purposes in his film Raiders of the Lost Ark.

  • Bertel Schmitt Bertel Schmitt on Apr 19, 2009

    My friend, I spent my childhood alongside two men who had numbers tatooed in their forearms. One was my uncle, a former Sturmbannführer in the Waffen SS who was - missing one eye and part of his head -released from Russian captivity in 1955, 10 years after the war had ended. The other was my buddie's father, a former concentration camp victim. Through us kids, the two men became friends. We listened to both of their harrowing stories. We watched them get drunk together and swear at the people who had robbed a good part of their lives. We didn't have to wait for a Steven Spielberg to belatedly learn something about Nazis while sitting at the beach in East Hampton. Raiders of the Lost Ark was produced in 1981. Having said that, I declare this thread as closed.

  • Dukeisduke So, the screen goes blank for two-tenths of a second, every once in a while - what could go wrong?
  • Dukeisduke "Hello, IT. Have you tried turning it off and on again?"(Roy in The IT Crowd)
  • Dukeisduke Just Say No To Bugs!
  • Dukeisduke So, avoid calcium? You're going to increase osteoporosis, among other things.
  • Dukeisduke Parts of the second picture look like CGI or airbrushing, especially the side of the seat showing the power seat controls, and the edge of the door with its latch and screws. I'm not convinced this is all real. Maybe none of it is.Also, the background with the enbankment with the green grass and cedars or junipers doesn't make me think of Austin - maybe somewhere in the Pacific Northwest.