Volkswagen releases massive investment strategy, seeks further cost cutting image

The German automaker, the largest in Europe and the second biggest in the world has just shown its latest investment strategy – aiming to poor into its automotive business 85.6 billion euros ($106 billion) over the next half a decade.

The new plan is a key asset to the relentless strategy for VW AG to become the largest global automaker, as it managed to pass General Motors in 2013 to secure the second place and is now just a whisker away from the powerful Japanese automaker Toyota. The new, multi-billion auto investment strategy that should be implemented during the next five years concentrates on further pushing expansion overseas, while developing new models and technologies that would support its quest.

According to the automaker, for the period between 2015 and 2019, the company would hike a little its capital expenditure to 6-7% of revenue, with most of the cash used for transforming its models into very fuel efficient ones – while production models should also be further developed. Around 41.3 billion euros from the new investments would be used for the new lineup of sports utility vehicles, modernizing part of the light commercial vehicle and the development of new hybrid and electric drive models. Also, according to sources from within the company, VW is now seeking cost reductions of about 10 billion euros ($12.4 billion), up from the previously revealed 5 billion euros.

Via Reuters