Volkswagen Spends Itself Through The Crisis
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.
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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Nice frames, but did VW invest in their motor engineering? The 1.4 TSI motors are suffering from premature timing chain failures...
Why did Toyota cut back on R&D spending? I thought they were long sighted (like the Germans) and not short sighted like GM.
It's something that should be kept track of. It would not surprise me to find that the ones who are willing and capable of maintaining R&D are the ones that will survive. That may be a short list.
It will be awhile before they convince me the quality is there. My last Jetta was a good looking, nice car. Until the suspension squeaks drove me crazy. The terrible dealership was the worst part of my experience, but thats not all VW's fault.