Monday, December 29, 2014

Volkswagen's Audi to step up investments in 2015-19 on models, plants

(Reuters) - Volkswagen's (VOWG_p.DE) flagship Audi division is to increase spending on new models, plants and technology through 2019 to push its goal of surpassing German rival BMW as the world's largest luxury-car manufacturer.
Audi, which contributes 40 percent of operating profit at Europe's biggest automotive group, said on Saturday it will push up investment in car-making operations by 2 billion euros ($2.44 billion) to a record 24 billion euros over the next five years.
Seventy percent of spending will be assigned to developing new models and technologies such as emission-cutting plug-in hybrid vehicles, Audi said. The brand is also working on purely electric cars to catch up with BMW (BMWG.DE) and Tesla Motors(TSLA.O).
More than half of the funds will be spent on Audi's two German factories in Ingolstadt and Neckarsulm which accounted for half the carmaker's nine-month output of 1.34 million autos, Audi said, confirming a Reuters story.
"We place top priority on sustainable growth," Chief Executive Rupert Stadler said. "That’s why we are making large investments in the innovative areas of electric mobility, connectivity and lightweight construction."
Audi, the world's second biggest luxury automaker, is aiming to expand its model range to 60 from currently 50 by 2020 and is spending over 1 billion euros on new factories inMexico and Brazil.
Ingolstadt-based Audi said on Saturday it will hire another 850 workers in Mexico next year where the Q5 sport-utility vehicle will be assembled from 2016.
Under its previous budget drawn up a year ago, Audi announced investments of 22 billion euros over the 2014-18 period. Parent VW in November unveiled auto investments of 85.6 billion euros through 2019, slightly more than a year earlier, even as the carmaker is pushing cost cuts at its core brand.

(Reporting by Andreas Cremer)

Friday, December 5, 2014

Volkswagen Group considering future Formula 1 entry

December 4, 2014
BBC Sport

The Volkswagen Group, the world's second biggest car maker, is conducting a feasibility study into a potential Formula 1 entry.
Sources say the review is being conducted by ex-Ferrari team principal Stefano Domenicali, who was hired by VW's Audi brand earlier this year.  Its interest is being piqued by the global marketing success achieved by rivals and new F1 champions Mercedes.  But any entry would depend on management changes at VW or F1.  Ferdinand Piech, the head of the supervisory board of the VW Group, and F1 commercial boss Bernie Ecclestone have long had a difficult relationship. At least one of them would need to leave their current position before a VW Group brand could enter F1.
VW was on the working group of car manufacturers that decided on the new turbo hybrid engine rules introduced into F1 this season, but decided against entering at that time - and, publicly, has not changed its stance since.
But sources say that some senior board members now believe F1 would be a more effective global promotional tool than its existing motorsport programmes.

BBC F1 chief analyst Eddie Jordan

"The Volkswagen Audi Group is the second biggest car maker in the world and as such it needs to be in Formula 1. But it will not enter it while the sport remains under the control of Bernie Ecclestone, who VAG boss Ferdinand Piech dislikes on a personal and professional basis. Martin Winterkorn - the chairman of the board of management of Volkswagen - is being groomed as Piech's successor and he has always believed that F1 is a great platform for the group's brands. I am told he privately believes VAG should be a part of F1. If VAG did come to F1, I believe it would be with their own team, with the car designed and made in Germany."
Among the Volkswagen Audi Group's brands, as well as VW and Audi, are Porsche, Lamborghini, Bugatti, Bentley, Skoda and Seat.VAG currently has three main motorsport programmes - with Audi and Porsche in the World Endurance Championship, Audi in the German Touring Car Championship (DTM) and Volkswagen in the World Rally Championship.The global advertising value of Mercedes' television appearances during its F1 campaign in 2014 was $2.8bn (£1.8bn).
Experts believe the equivalent value for VAG of their sportscar and touring car programmes was about $30m (£19m).Mercedes spent a net 130m euros (£103m) on F1, once external sponsorship and prize money is taken into account. VAG spent about 320m euros (£254m) on DTM and sportscars.Some reports have linked a potential VAG return with the Austrian Red Bull team - Piech has a close relationship with Red Bull owner Dietrich Mateschitz.But sources say that VAG turned down an approach from Red Bull some years ago and that if it did enter F1 it would be with its own team based in Germany.Asked for a comment, a spokesman did not deny the information but pointed to an interview with the chairman of the VW board of management Martin Winterkorn in the German newspaper Bild Am Sonntag last month, in which he suggested the group was happy with its existing commitments.Winterkorn said: "Our brands in motorsport are as successful as ever, whether in the DTM with Audi or Le Mans with Audi and Porsche, or in the World Rally Championship with Volkswagen. We feel we have really good position."Audi chairman Rupert Stadler said in an interview with another German newspaper, Heilbronner Stimmer, that Domenicali had expressed a desire not to work in motorsport and that he was working in "organisation and new business fields in the areas of service and mobility".