Volkswagen is going to radically overhaul its structure and organization by early next year, sources have told Handelsblatt.
The company’s subsidiaries will be separated out from its core business and streamlined. Its design department, headed by Walter de Silva, which currently uses up €100 million a year, will be slimmed down. Marketing budgets will also be cut: there will be no more lavish parties on the eve of important trade fairs in Frankfurt, Geneva and China. These cuts are expected to save some €24 million.
Chief executive Matthias Müller is also expected to announce a “Strategy 2025” plan by next year that will result in a reorganization of Volkswagen’s entire passenger car business. “We will question what we do with each brand in each region,” a manager told Handelsbatt.
At the moment, Seat, Skoda, Audi and Volkswagen brands often compete with each other in the same regions. This strategy was aimed at winning more customers, but the manager said this has come at the expense of profitability, “and therefore it has to end.”