Volkswagen Electric Vehicles drives review of its Supercar Brands
Undergoing a new strategy to shift towards mass production of electric vehicles, Volkswagen placed its supercar brands under review.
Ducati, Lamborghini and Bugatti are currently in uncertain waters as the upcoming November meeting of VW’s board of directors will decide their fate. The decision came as Volkswagen is also looking to double its value, reaching approximately 200 billion euros.
credit: Matti Blume / CC BY-SA
As two unnamed senior executives declared for Reuters, the three exotic brands may go through restructuring, selling or other procedures in order to free up cash for the mainstream production.
Herbert Diess, Chief Executive Officer of Volkswagen is reportedly looking for ways to push even more billions into research and development of electric drives, moving away from combustion units.
Diess refused to comment on the fate of the high-performance brands but admitted the need for revamping of the VW brand to make the push towards the electric and autonomous automotive era.
In terms of revenue, Lamborghini managed to sell 4,554 units in 2019 with prices ranging from $200,000 up to a few millions for special edition models.
French luxury brand Bugatti released its newest model last year, called Divo. First unit was sold for a staggering $5.8 million and was one of the 84 vehicles Bugatti sold through 2019. Motorcycle brand Ducati managed to sell little over 53,000 units in 2019.
Since Volkswagen needs to rely on its combustion cars sales revenue to boost electric vehicles and autonomous research and production, difficult decisions need to be taken in regard to funneling the most amount of cash.
Recent leaked information surfaced of a potential sale of the Bugatti brand to Croatian electric supercar brand Rimac. In exchange for Bugatti, Volkswagen would acquire a larger share in Rimac and thus push forward with their efforts towards electrification.
Currently, Volkswagen owns 15,5% of Rimac and if negotiations succeed, the share would increase to 49%.
Although it has almost twice the number of employees, Volkswagen (78 billion euros) is worth roughly 2.5 times less than its main competitor Toyota (187 billion euros). The two automakers have almost identical sale figures in 2019, with Volkswagen taking the edge (10.96 million cars vs 10.74 million cars sold by Toyota).
With these figures in mind, it becomes clear that Volkswagen needs to take radical decisions in order to raise its market value. According to VW Group’s board chairman Hans Dieter Poetsch, restructuring and listing brands for sale is the right strategy.
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