VW increasing its efforts to lead the Mobility industry in 2019!
We are almost at the end of the year and a lot of big players in the autonomous driving “space” are starting to deploy strategies, partnerships and spin up companies to fulfil their 2025 vision. We want to take a particular look at a company in the automotive ecosystem that never ceases to impress us and that this year has accelerated and shaken the market. We are of course talking about the VW Group.
VW realised by the end of last year that they needed to “pick up” some speed when it came to their innovation strategy and their overall positioning in the market. This belief was enhanced even more after the diesel scandal and the attempts by a number of American/Chinese automotive giants to acquire some of VW’s market share in autonomous technology and electrification fields. The giant, VW, reacted (also urged by the Merkel administration) and when giants react, it can have major impacts on the markets they operate in in either positive or negative ways.
VW in reaction to market pressures as mentioned above made a combination of strategic and other decisions to strengthen its current and future position. So, let us have a look at 4 of the biggest announcements that VW made this year and their potential effect.
- Electric Vehicle Investment: VW group announced that 7 electric vehicles lines would be in their cycle plan from 2021 onwards and that the group would invest $1.7B in electrification alone. The electric vehicles lines would cover all customer segments from small vehicles to commercial vehicles. This is a substantial investment and statement. The response in the market has generally been positive as it would reduce the company’s environmental footprint of the company through the supply-chain for electric vehicles. However smaller vehicle manufacturers that were planning to compete in the MaaS market with electric vehicles were directly affected by this. A clear example was the Dyson electric vehicle program which has now been axed.
- Joint Venture between Ford & VW for commercial vehicles with Autonomous and MaaS and TaaS Business Models: Ford Transit and VW Camper/Transporter vans have almost 45% of the market on commercial vehicles. The objective of this JV is to co-develop autonomous features with Ford and explore the potential Mobility-as-a-Service and Transport-as-a-Service. This JV is still under review, but it shows the big commitment that VW is making to autonomous vehicles and new business models.
- Development of AID and investment in start-ups and a stake in Argo AI: AID was created in 2017 in partnership with the Audi group to develop and explore the road to autonomy and opportunities to activate the autonomous driving, AI, Software and Hardware ecosystems. (I am not sure what this sentence means. Since then, the AID team has been involved in several interesting projects and has been actively working with many tech Start-ups in the ecosystem. In addition, VW has also made an investment in Argo A.I., a start-up based in Silicon Valley working on the development of an autonomous platform for level 4 and above. Ford also has a major stake in this company.
- The creation of VW Autonomy (VWAT): In early November (2019) VW announced the creation of a subsidiary organisation. The new company – VWAT will bundle the VW Group’s activities for the development of self-driving systems for Level 4 autonomous technology at four planned sites. The company will be headquartered in Munich and Wolfsburg. The objective of VWAT is “to establish Volkswagen Autonomy as a global technology company where we bundle expertise from the automotive and technology industries, combining the agility and creativity of a high-performance culture with process orientation and scalability” said Alexander Hitzinger, Director of VWAT. Mobility solutions for people and goods in urban areas will be the first application case for the SDS from Volkswagen Autonomy GmbH.
So, this year has been a busy year for the team at VW Group and it looks like they have an interesting task ahead of then to make sure that all the investments they have made in 2019 pay off by 2025. There is still a lot more research and funding to be done on the road to intelligent mobility and at Y-Mobility we see a positive trend for VW as some of this year’s commitments are quite promising for a mass adoption of autonomy and the implementation of MaaS and TaaS.
Feel free to click here to read all about the VW Group’s 6 year strategic plan.
What are your thoughts on the above? Any comments or suggestions of something we should add to our Blog?