Volkswagen: The Assignment
Summary of the case
Volkswagen executives acknowledge that if they make cars that appeal to American drivers, the number of vehicles sold in United States will increase. Volkswagen vehicles comprises of a few advantages especially its core competence in the design and manufacture of small, fuel-efficient gasoline engines. Its diesel engines also offer money-saving performance which is a main attraction that drivers seek for when gasoline price increases. However, Volkswagen currently only rank third among global automakers, it had only captured 3% of United States car market. Therefore, Volkswagen needs the right products and local production which is what ...view middle of the document...
Furthermore, Volkswagen also comes up with product strategy for Passat, where production is shifted to “new midsize sedan”, capable of producing diesel-powered cars, where diesel engines get higher mileage than gasoline engines cars. However, the diesel engines are not popular with majority United States drivers, by contrast diesels are very popular in Europe. Summarizing the strategic challenges Volkswagen faced, Volkswagen has to get it right by adjusting to American standards of their on the road quality.
Volkswagen is a well-established Germany automobile manufacturer, with three cars in the top 10 list of best-selling cars of all time which are the Gold, Beetle and Passat, which leads to its success in having the most cars of any automobile manufacturer in the list that are still being manufactured. Volkswagen means “people’s car” in German and its current international slogan is “Das Auto” which means “The Car”.
Volkswagen intends to innovate their technologies to become wold leader in producing cars which achieve their customers’ satisfaction and quality as they see high customer satisfaction as one of the main requirements for the company’s long term success. Their targeted goal is to generate unit sales of more than 10 million vehicles in a year, in particular, they intend to capture above-average share of growth in major markets.
In order to reach their target, the company offers a wide range of products to keep the customers satisfied and lift up to their expectations depending on customers’ needs. They intend to create product image such as high quality cars supported with well-known brand name, excellent service delivery with few complaints and good distribution products.
Volkswagen uses media like television commercial and print media to promote its brand and products in addition to being sponsors of numerous car events and corporate events. Depending on the range, size and power of engine, Volkswagen price their cars from affordable to expensive and pride themselves as a car manufacturer which manufactures cars that average people can afford.
Q1. Do you think CEO Winterkorn’s pronouncements about 2018 are legitimate goals, or are they “stretch” goals designed to motivate employees?
CEO of Volkswagen, Winterkorn, sets a few goals for Volkswagen as a guideline for their company so that they can improve. The 2018 goals states that Volkswagen will achieve additional sales in future, becoming the world leader in customer satisfaction and quality, aims in becoming the top employers across other brands and companies, and lastly to be able to gain at least 8% of sustainable sales before taxations as to ensure that they have a solid financial position (http://www.volkswagenag.com/content/vwcorp/content/en/investor_relations/Warum_Volkswagen/Strategy.html). It is important for Volkswagen to have a goal so that it can be a guideline. When the CEO Winterkorn pronounce about the 2018 goals, I personally think that it is a...