Volkswagen Group
Volkswagen (VW), arguably one of the world’s most recognized car companies, is owned by the Volkswagen Group. The Volkswagen Group is a multinational corporation founded in 1937 with its headquarters based in Wolfsburg, Germany. Its operations encompass the development, manufacturing, and sale of automobiles, motorcycles, and commercial vehicles, and financial services. It has over 500 associated companies and is the largest carmaker in Europe, with a revenue of €265 billion in 2019. VW is one of the most recognized brands in the world, partly because of its characteristic racing stripes, which are a symbol of its iconic vehicles.
Volkswagen Group holds about 99.65% of Volkswagen AG shares. VW AG, the parent company of Volkswagen, is a public company traded on the Frankfurt Stock Exchange and the London Stock Exchange. The main shareholders of VW AG are Porsche SE, Qatar Investment Authority, Lower Saxony Ministry of Finance, and the State of Schleswig-Holstein, with 24%, 17.5%, 15.5%, and 7% of the company’s shares respectively. Union Investment, Sabanci Holding, and L&G Investment Management each owns about 5% of the company’s shares.
With its widespread presence across the world, VW consists of acquired brands like Lamborghini, Bentley, Bugatti, Audi, Ducati, Porsche, SEAT, Skoda, Scania, and MAN Trucks. This highlights how the Volkswagen Group has become a world-renowned automotive empire, operating in 140 countries and 24 different production sites globally.
Since its foundation, the company has been undergoing a series of continuous transformations to cope with changing market conditions. For instance, the company incorporated the “Together-Strategy 2025” in the fall of 2016 which aimed to increase the company’s focus on electromobility, digital services, and new mobility services. Additionally, with regulatory standards changing, VW is also beginning to reduce their dependence on fuel-driven engines and moving towards a more sustainable portfolio. This growth and transformation have allowed VW to top the list of world’s largest carmakers by sales, slashing past rival Toyota Motor Corporation in 2018 as the world’s largest carmaker.
Innovation & Strategies
Volkswagen has always been a pioneer in innovation. It is seen in their history of strong and long-standing commitment to safety and environmental friendliness. For example, VW Group was the first car maker in Europe to introduce Electronic Stability Program, but it was first applied in the Audi A8 in 1994. This technology helps to improve car handling and stability during adverse weather conditions.
Innovation has also been a part of VW’s strategy when it comes to fueling the growth of market shares. By offering more variety and customization in their vehicles, they have been able to create a larger consumer base. For instance, the VW Amarok, a pick-up truck that was launched in 2010, provided more customization options with their “Segment Strategy”. This platform allows customers to have 4 possible levels of selection – Value, Urban, Adventure, and Sport.
Moreover, when it comes to production, VW has also embraced efficient and flexible manufacturing technologies, such as digital and robotic process automation. This speeds up the development cycle of their vehicles, leading to a faster and more cost-effective production. These technologies have also allowed VW to adapt to changing consumer preferences and create suitable environmental solutions that meet the requirements of governments and regulators.
The Level 5 automation system offers the most comprehensive technology to replace human driving, creating an environment where driverless vehicles can become a reality. This technology can be applied in last-mile delivery and long-distance transportation, further improving the production and delivery processes for the company.
Corporate Social Responsibility
Apart from being a leading carmaker in the automotive industry, Volkswagen has also placed a strong emphasis on Corporate Social Responsibility (CSR). As part of their CSR initiatives, they have focused on protecting natural resources and promoting sustainability, while also making efforts to eliminate emissions and improve their operations.
The company’s Volkswagen Do Brasil project is an example of this, where they have introduced a range of initiatives aimed at improving the environment and conserving resources. Additionally, the company has also launched sustainability initiatives such as the “Green Program”, aiming to reduce its environmental impact and promote local communities. Moreover, the company has also actively involved in numerous social development projects such as providing educational resources and training reforms.
These initiatives were not only implemented in the production processes but also extended to their corporate structure. This included appointing a Human Rights Officer to ensure that human-rights principles are upheld in the company’s projects, operations, and service in the communities. Moreover, VW has also taken steps to increase transparency in their business decisions through the annual Corporate Social Responsibility report which was first published in 2019.
Marketing Strategies
Apart from innovation, production and sustainability, marketing has also been a big part of VW Group’s global success. The company has had numerous marketing campaigns that have helped boost their visibility across the world. This includes the iconic “Think Small” VW Beetle campaign in 1960s, which was an international success, as well as its “Das Auto” campaign, which was extremely successful in the United Kingdom and North America.
In recent years, VW has also invested heavily in digital marketing, using social media platforms such as Facebook, Instagram, and YouTube. Additionally, VW also uses influencer marketing to create content with popular celebrity personalities and influencers. For example, in 2016 VW partnered with YouTube star JackSepticEye to promote their new Golf model.
Moreover, VW has recognised the importance of customer experience and has also invested in research and development, creating technology like the “Meet VW” app, where customers can experience features of VW cars without needing to physically test them. They have also created an interactive car finder experience, allowing customers to search for the best car based on their preferences.
Initiatives
The Volkswagen Group has committed to the long-term goal of transitioning from a business model that uses fossils fuels to one that promotes the use of electrified and sustainable propulsion technologies. This is seen in their “Go to Zero” initiative, where the company aims to reduce its CO2 emissions to net zero by 2050.
Together with this initiative, Volkswagen developed plans for “Electrify 2025” where it intends to invest €30 billion in Research and Development. This investment will focus on expanding their range of electric vehicles to cover all segments in order to become the number one in electric car sales. They have also announced the production of 70 all-electric vehicles by 2028, which will be made available in 140 different countries.
Verdi, an independent sustainability think tank, has recognised VW’s commitment to the environment with their “Green Flower” award in 2019. This award is based on the sustainability score, which evaluates companies on their efforts and objectives to reduce their emissions and improve their sustainability practices.
Partnerships
Apart from its own initiatives, Volkswagen Group has also partnered with various companies in order to increase their sustainability efforts. For example, the company has formed partnerships with battery suppliers such as SK Innovation and LG Chem to collaborate on developing high-performance battery technologies. They are also working with other car companies such as Ford Motor Company and BMW to create an Ultra-Fast charging network to support their electric vehicles.
The Group has also partnered with Amazon Web Services (AWS), Microsoft, and Siemens to develop cloud-based services for their automobiles. Additionally, VW has also announced a strategic partnership with Google for the development of in-car AI technologies and connected vehicle systems, allowing customers to interact with their cars in more innovative ways.
Conclusion
Volkswagen, through its parent company VW AG is owned by the Volkswagen Group, one of the world’s most powerful car companies. Over the years, VW has become a leading global carmaker with an iconic brand, holding 99.65% of VW AG shares. The company has been transforming and innovating in order to keep up with changing market conditions and regulatory standards, leading to its successful growth and success. These changes and strategies have been seen in the company’s continuous efforts to remain the world’s largest carmaker, its commitment to sustainability, and its strategic partnerships with other companies.
