Volkswagen commits $71B on mission to become world's number oneby Mark Kleis
The dust has yet to settle from Toyota's tumble from undisputed auto ruler of the world, but VW is already vowing to spend $71B to take the path already traveled.
Although many - including its own CEO - attribute Toyota's recent missteps to its overzealous and rapid expansion, Volkswagen continues to charge ahead unabashedly in an effort to become the world's largest automaker by 2018.
In order to drive that point home, VW said today that it will be investing what equates to $71 billion over the next five years, with the end-goal to become the world's premiere automaker in terms of sales and profitability by 2018, according to Automotive News.
"These investments underline Volkswagen's goal of becoming the leading automobile manufacturer for its customers, employees and shareholders," said VW CEO Martin Winterkorn. Adding, "We are systematically pursuing the goals of our Strategy 2018 to further increase our profitability and to make Volkswagen the world's most future-proof automotive group."
Investment break down
Although the $71 billion figure may sound incredibly extreme, and borderline impossible, the figure includes all normal development and improvements over the course of a five-year time period - albeit boosted and accelerated beyond normal means.
Just shy of $38 billion of the total will be allocated towards the development and improvement of each and every brand in the Volkswagen Auto Group, ranging from Seat, Skoda and VW, to Audi, Bentley, Lamborghini and Porsche. VW says the main purpose of the funding will be to create new and all-new vehicles based largely on the new modular architecture being employed by the VW AG.
Another $18.5 billion will be spent on cross-product investments, while $14 billion will go towards additions to capitalized investment costs.
Change is on the way
VW says that it also realizes it must make improvements in the quality of its products as well, ranging from basic manufacturing to the final steps of paint and assembly.
The German automaker will also continue its expansion into global markets such as China and the U.S., adding two plants in China and one in the U.S.
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