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WOLFSBURG, Germany -- Volkswagen Group on Friday said it will spend $50.2 billion (44 billion euros ) on electric vehicles, digitalization, autonomous driving and new mobility services by 2023.
The automaker also plans to increase productivity of its factories by 30 percent by 2025, by building more vehicles with different brands on the same production line, it said.
This will help lower the carmaker's capital expenditure ratio at the group's automotive division to six percent of revenues from 2020 onward, the carmaker said.
The 44 billion euro plan is 10 billion euros ($11.4 billion) more compared with last year’s planning round.
The spending represents about a third of Volkswagen’s five-year budget on capital goods such as property and plants. Despite the increase, the world’s biggest carmaker stuck with a target of lowering capital expenditures to 6 percent of sales from 2020. To achieve this goal, VW’s plants, spanning some 120 facilities globally, will reduce costs. Last year, the ratio shrank to 6.4 percent.
VW is launching upscale electric Porsche and Audi models due to go on sale next year to keep up with other global automakers as well as more affordable vehicles under VW’s I.D. subbrand starting in 2020.
VW said it could build up to 15 million electric cars over several years on its new MEB EV production platform.
"Volkswagen must become more efficient, more productive and more profitable in order to finance the high expenditure in he future and stay competitive," CEO Herbert Diess said during a press conference.
Since taking the helm in April, Diess has set about revamping the 12-auto brand behemoth to better meet future challenges, pledging to rein in bloated costs and boost economies of scale.
A more agile setup is critical as the industry deals with slowing economic growth, trade barriers and the uncertainty of a post-Brexit Europe. German peers Daimler AG and BMW AG have cut their outlook, while Toyota Motor Corp. and General Motors Co. reported strong results.
Diess said he hoped to have an outline agreement on Ford cooperation fleshed out by year end, with the initial focus on commercial vehicles. He said a merger with Ford was not on the agenda and also said there were no plans to take a stake in the American company.
Msn.News
The automaker also plans to increase productivity of its factories by 30 percent by 2025, by building more vehicles with different brands on the same production line, it said.
This will help lower the carmaker's capital expenditure ratio at the group's automotive division to six percent of revenues from 2020 onward, the carmaker said.
The 44 billion euro plan is 10 billion euros ($11.4 billion) more compared with last year’s planning round.
The spending represents about a third of Volkswagen’s five-year budget on capital goods such as property and plants. Despite the increase, the world’s biggest carmaker stuck with a target of lowering capital expenditures to 6 percent of sales from 2020. To achieve this goal, VW’s plants, spanning some 120 facilities globally, will reduce costs. Last year, the ratio shrank to 6.4 percent.
VW is launching upscale electric Porsche and Audi models due to go on sale next year to keep up with other global automakers as well as more affordable vehicles under VW’s I.D. subbrand starting in 2020.
VW said it could build up to 15 million electric cars over several years on its new MEB EV production platform.
"Volkswagen must become more efficient, more productive and more profitable in order to finance the high expenditure in he future and stay competitive," CEO Herbert Diess said during a press conference.
Since taking the helm in April, Diess has set about revamping the 12-auto brand behemoth to better meet future challenges, pledging to rein in bloated costs and boost economies of scale.
A more agile setup is critical as the industry deals with slowing economic growth, trade barriers and the uncertainty of a post-Brexit Europe. German peers Daimler AG and BMW AG have cut their outlook, while Toyota Motor Corp. and General Motors Co. reported strong results.
Diess said he hoped to have an outline agreement on Ford cooperation fleshed out by year end, with the initial focus on commercial vehicles. He said a merger with Ford was not on the agenda and also said there were no plans to take a stake in the American company.
Msn.News