VW faces hurdles in strive to become world’s No. 1 automaker image

Thanks to stellar results in China, the world’s biggest auto market and the second largest when it comes to luxury cars, the Volkswagen Group managed last year to pass General Motors and become the second car producer in the world, behind Japan’s Toyota.

With each passing quarterly financial result, VW’s sales grow, but at the same time, the executive in charge of sales warns the worldwide situation remains tense in certain areas – for VW the most problematic being the Americas.

“VW’s size is turning into a curse,” said Stefan Bratzel, head of the Center of Automotive Management think-tank near Cologne. “Costs are beginning to get out of hand, inefficiencies keep growing and troubles are looming into focus around the world.”

And as the management mulls cost cuts and maybe even personnel reductions at the core VW brand, the relations between the “command” structure and workers have reached a decade low. Many insiders say they could be even worse than what they were the last time the company took out around 20,000 jobs in Germany.

The operating profit at the VW brand has also been hit by an internal factor – the new and ambitious MQB modular platform has been a drag, increasing the automaker’s spending on technology.

Via Automotive News Europe