Two weeks ago, it was reported that Volkswagen Group was looking to sell off the Bugatti moniker to EV Hypercar manufacturer Rimac. Now, a new report has been revealed that suggests the German conglomerate will be deciding both Bugatti and Lamborghini’s place in its group next month.
Talking to Reuters, two unnamed senior executives of the group revealed that in a push to mass produce electric cars, these high-end performance brands may not have a place in VAG’s portfolio in the near future.
Next month, Volkswagen’s management board and directors will review the automotive group’s strategy and put together a new “to-do list” in an attempt to double the company’s value to €200 billion (±R3,9 trillion). With this review, it’s likely that technology partnerships with both supercar brands will be put up for sale.
VW Group is currently looking at whether it has sufficient resources to focus on the development of electric cars for its smaller brands while investing billions to adapt mainline models. This decision, which Chief Executive Herbert Diess is faced with, hopes to find new ways to access funds which will allow the group to move away from internal combustion engines.
Diess declined to comment about the performance brands in detail but did admit that Volkswagen’s shift to electromobility and autonomy is of the upmost importance.
“We are constantly looking at our brand portfolio, this is particularly true during the phase of fundamental change in our industry. In view of the market disruption, we must focus and ask ourselves what the transformation means for the individual parts of the group,” Diess told Reuters.
“Brands must be measured against new requirements. By electrification, by reach, by digitalisation and connectivity of the vehicle. There is new room for manoeuvre and every brand must find its new place,” he said.
As of 2019, the Volkswagen group sold 4 544 Lamborghinis and 82 Bugattis. Given the nominal price tags on these products these sales figures are positive but some company insiders are reported to have doubts about investing scarce resources to produce electric performance cars that don’t appeal to the fans of these brands.
Diess believes that VAG’s valuation will increase once the market realises how profitable electric vehicles can be. After EU lawmakers proposed a 50 per cent cut in carbon dioxide emissions by 2030 however, the group faces a short-term investment crunch. Despite this, the goal of raising the brand’s market value to the target of €200 billion by 2025 is still on track.
“Volkswagen is severely undervalued when you look at its technological competence, its global positioning and perhaps also when you see that, compared with the competition, we have the best prerequisites in terms of technology.” Diess said.
It has been made clear that Volkswagen has no plans to list Porsche or Audi in the near future according to IG Metall, Germany’s biggest worker’s union.