Excellent analysis, dark knight! Kudos to you! Was a real delight to read.
And totally agreed, the new strategy for Volkswagen AG under Dr. Winterkorn, of which the MQB, MLB, etc are integral parts, has been a complete revolution. The sheer flexibility it allows across segments, body styles, brands and markets, is mind blowing. Not to mention the reduced complexities while developing new cars.
Ulrich Hackenberg, who was in R&D at VW, had once called it a 'strategic weapon'. And a weapon it indeed is. Ask Toyota, GM, etc. who are facing its assault.
And I feel the perfect showcase for it is also a gem of a car, VW's own Passat. The car has come a long way, since the older cars to the B7, which could even park itself! And now the B8 is in fact so good, I think the Passat can now be called the 'quintessential Volkswagen', ahead of both the Beetle and the Golf.
Coming back to the main topic, Dr. Piech was always a very stubborn man, often to the point of being ruthless. You know to what extent, when you see him being called a 'backstabber' in a tribute article (
http://www.topgear.com/car-news/insi...arture-matters). And this wasn't the first time he had issues with the CEO, it was a similar case with Dr. Bernd Pischetsreider and Mr. Herbert Demel as well. Don't understand how he wanted to get rid of Dr. Winterkorn though. It almost felt like he held a grudge against Dr. Winterkorn, and by any means wanted to see him out. As for sales in their traditionally weak markets, it is neither Dr. Piech nor Dr. Winterkorn who are responsible for such numbers. It is that Volkswagen's own brand of products doesn't usually gel with the demands of the market.
Anyways, speaking of Dr. Winterkorn, I initially felt confident he was finally the man who could lead VW group to a strong position in the US market. But seems like that was not to be. In fact, sales had dropped considerably under him due to various reasons.
I feel Volkswagen could never really capture the US due to difference in their basic approach. The US market appeared to be more concerned about what they get in a product, while Volkswagen themselves seemed to be more proud about what went behind theirs.
Further, Volkswagen group never really specialised in SUV's or pickups. They did have excellent SUV's like the Touareg or the Audi Q7, but they were bettered by the Americans and Japanese.
Here, I think owning a brand like JLR would have been crucial for VW. Not only would Land Rover have given them strong SUV specialization, but a brand like Jaguar would've also meant more stylish designs in the stable, which they really needed.
And as you mention, recently the extremely high standards of quality would have taken a drop due to the focus for volumes, but the way they were heading still seemed to be the right way. The recent designs were beginning to feel more exciting, and with a set of excellent engines and gearboxes, it appeared that Volkswagen would actually start delivering more appealing cars, and not just mundane but well-built ones. And when the 'number one' crown was so close in sight, the focus on rolling out more cars faster was actually understandable.
They almost always nailed the marketing part though, and even in our Indian ads, they have played the desirability card exceedingly well. If there could ever be an Apple for cars, it could most likely be Volkswagen.
As about Audi, they are usually the more high-tech brand among the big three, and never really seemed to have specialised in driver appeal like BMW, or pure comfort like Mercedes-Benz. Even the R8 for all it's practicality and quality isn't really a handler. Rather, Audi is known to be more of a technology pioneer, and primarily due to none other than Dr. Piech. But as the competition caught up, it became tough for Audi over time.
Another factor behind their recent decline, as mentioned in your post, could possibly be the recent transformation of Mercedes-Benz. They have completely changed their approach, and have begun focusing on design and modern tech, and releasing visibly 'younger' cars. Their design language has undergone smooth transition from sedate to svelte, which is evident in all their new cars including the W222 S-Class. And I've been hearing their newer cars are getting really popular in the USA. And that design language will certainly continue, as the designs would likely give them better image among younger audience, and also a better chance against the likes of Jaguar.
As for Asian and other developing countries, Volkswagen just doesn't have the products that would sell in big numbers in these markets. Neither are Volkswagen the kind of company who would have products that would potentially sell in big numbers in these markets. And I would say it's not Volkswagen who need to adapt to the markets by going out of the way to further save costs and compromise on quality and safety, instead it's the markets who should adapt to better quality but necessarily more expensive products in line with developed countries.
If we think of India specifically, there is a serious appeal for European cars, and big cars in general. Problem is, at the volume end, cost is too big a problem here, or rather being made into too big a problem. Thus, to save a few thousand in taxes, there are 'compact' cars, which are compromises in design and space. Now, there's simply no car Volkswagen could make a successful 'compact car' out of, neither would such a car suit their premium image here. And a full-size car would appear too pricey and under-equipped against the lower-priced rivals. Plus, hi-tech automatics are too expensive for our budget cars, and our people are too conscious about fuel efficiency, service and space, all not the biggest strengths of VW. What are their strengths though, namely safety, build quality, etc are seldom cared about by the people.
And a prestigious company like Volkswagen would much rather preserve and develop a brand, rather than compete among low end models in a small volume market.
The UP!, Volkswagen's latest vision of an affordable small car, just couldn't have worked here.
(Or maybe it could, perhaps in the metros. It could have given our people an idea what world class budget cars are like. And if it were to become a trend, and the new 'cool' small car in the public's eye, we would've had a budget end revolution, with all companies fighting it with their global budget cars in India, not 'Indianised' models.)
Not that any little success here would matter at all to VW anyway, as has been said earlier in the thread. Neither the infrastructure, nor the economy is fit to unleash their global products here. And so is not the people's outlook. They may only start thinking of our market seriously once it matures economically enough to buy enough of their cars.
28th April 2015, 11:04
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Thanks
