Geneva 2016: Volkswagen Group Places Priority on Digitalization

• Design and digitalization become one unit: three new “Volkswagen Group Future Centers” in Europe, Asia and California.
• CEO Matthias Müller: “We are realigning our Group Design for the digital era.”
• Head of Digitalization Johann Jungwirth: “Volkswagen Group will become a leading mobility provider by 2025.”
• Emissions issue: recall campaign in Europe successfully started.

The Volkswagen Group is sending a clear message about the mobility of the future from the Geneva International Motor Show. CEO Matthias Müller announced three new “Volkswagen Group Future Centers” in Europe, Asia and California at the Group Night event. Designers and digitalization experts will work together on the car of the future at these centers. “We are realigning our Group Design for the digital era”, Müller said. In addition, an “autonomous driving” offensive has been started with the aim of bringing this core technology to market maturity faster than the competition.

These two key strategic decisions underscore the Group’s conviction that digitalization will open up new fields of business and sales potential. “That is why the digital transformation is very high on the agenda for the Volkswagen Group”, Müller stated, adding that the key to success lay in combining the automobile and the digital worlds “so that customers, society and industry can benefit”. In the future, building excellent cars alone would not be enough. Müller said the Volkswagen Group had understood the signs: “We want change, we are driving it forward.”

Johann Jungwirth’s presence at the Group Night also underscored this change. Jungwirth, who became Chief Digital Officer at the Volkswagen Group in November 2015, made clear where the realigned Group was headed: “I am firmly convinced we will become a leading mobility provider by 2025.” He described how the Volkswagen Group would “in part become a software and services company” in the process. With regard to the mobility of the future, the great advantage for Volkswagen lay in the fact that “we have already perfectly mastered the hardware – in other words, how to build cars.”

The Volkswagen Group will be intensifying the interaction between its digitalization and design activities – a groundbreaking approach for the automotive industry. The three “Volkswagen Group Future Centers” will be located in Potsdam, California and China. Designers and digitalization experts will work there hand in hand on the car of the future. The mission: to make Volkswagen Group vehicles best in class in terms of customer experience, interface design, operating logic, new interior concepts, and infotainment/entertainment. Michael Mauer became the Head of Group Design this January. The realignment will be implemented in close cooperation with the Group’s digitalization department. The studio in Potsdam has already begun working under the new concept. The decisions regarding the locations for the new centers in California and Asia will be taken soon.

CEO Müller emphasized that shaping the future will only succeed “if, at the same time, we learn from past mistakes”. In that respect, he said, the current year was an important step along the way: “2016 is the year when we intend to solve the problem with our diesel engines for our customers, and when we realign the Group for the future.” That would lay the foundation for a strong Group, Müller commented in Geneva: “We are tackling this twofold task with the necessary respect, but also in the firm conviction that the Group and its brands can and will emerge from this difficult phase even stronger.”

He said the Group was making good progress with working through the emissions issue, the recall campaign in Europe had started successfully: “Our customers are at the very heart of this campaign. We can and will make sure their workshop visit is as effective as possible.” Müller also confirmed that the Group would be presenting a substantial report on the status of the clarification process in foreseeable future. “And we will be drawing the right consequences from the findings.”

The Group is also forging ahead with electromobility. The Volkswagen Group currently has nine electric vehicles and plug-in hybrids in its product range. It will be adding a further 20 models by 2020. “All-electric ranges of over 500 km are feasible by the end of the decade. Charging will only take as long as a coffee break. And in the long term an electric car will cost less than a car with an internal combustion engine”, Müller said. However, a concerted effort was needed on the part of industry and politics, above all with regard to setting up a comprehensive charging infrastructure so that electric mobility could penetrate the market faster.

Talking in Geneva, the Group CEO pointed out that until then there would be a few more years when new drive technologies coexist with conventional internal combustion engines. “Our experts have developed fascinating technologies: from 3- to 16-cylinder engines, from natural gas to efficient diesel drives. And here, too, we can and will get even better”, Müller said.

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