Volkswagen Group CFO Arno Antlitz announced in an interview with the Financial Times that the German auto conglomerate plans to phase out 60 percent of its internal combustion engine models over the next eight years.
According to the executive, the measure – which obviously helps in advancing the electrification of the manufacturer’s fleet – actually seeks to improve the profit margins of the nine Volkswagen Group brands. Antlitz mentioned that “the key objective is not growth. We are focused on quality and margins, rather than volume and market share.”
The executive’s statements confirm something we have seen in recent years. Volkswagen Group, after a costly scandal stemming from cheating regulators around the world over diesel emissions from some of its most popular cars, has finally abandoned its obsession with being the world’s number one automaker. In 2020, it ceded the number one spot in global sales to Toyota, a position the Japanese automaker easily retained in 2021.
Currently, the Volkswagen Group offers around 100 internal combustion engine models worldwide, a number that would be reduced to around 40 by the end of the decade. For now, the electric vehicles launched mainly by their German brands (Volkswagen, Audi and Porsche) they have come to complement their lines and not to replace models with a combustion engine, a situation that should change in a relatively short time in order to reach the announced goal (not all those eliminated will necessarily be replaced by electric cars).
The goal, however, is consistent with some announcements made by the manufacturer’s brands. Porsche, for example, mentioned that its 718 Cayman and Boxster models will be fully electric from 2025. In addition, it expects 80 percent of its sales to be made up of electric cars by 2030. For its part, Audi announced that it has the intention of build your last internal combustion car in 2033something that Bentley said it would do even earlier, in 2030. Lamborghini promised its first electric model by 2027 or a more radar in 2028.
For the group’s most popular brands, Volkswagen, Seat, Cupra and Skoda, the transition will be more laborious but also more interconnected and simultaneous. It probably represents the loss of low-cost models in emerging markets. Among them, Volkswagen is leading the effort with its ID electric car lineup, whose fifth model globally and second in North America, the ID. Buzz, was revealed last month.