“The numbers show: our strategy is working”

One year after the launch of the Volkswagen brand’s TRANSFORM.TOGETHER production strategy, the first signs of success are now emerging. Since then, productivity in the plants has risen more than expected, says Andreas Tostmann, Board Member for Production and Logistics: “The figures demonstrate that our strategy is working. In 2019, our productivity will have improved by more than six percent. And for the first time since 2013, we lowered the costs per vehicle in production. The workforce did an extraordinary great job here and I thank them very much for their achievements.”

In 2019, production will already make a contribution of around 500 million euros to reducing costs. Between 2019 and 2023, a total of two billion euros is to be generated. Production also has its sights set firmly on the targets it has set itself for CO₂ emissions: CO₂ emissions per vehicle produced were already reduced by 22 percent in 2019 compared with 2015. Emissions are to be halved by 2025.

Increased production efficiency and productivity

“We have demonstrated team spirit, and with our new models we managed strong and smooth starts of production,” says Andreas Tostmann. “With great competence, our colleagues consistently contribute to increasing production efficiency and productivity.” In total, the production facility costs of the Volkswagen brand amount to around ten billion euros. The two billion euros that production intends to contribute to improving the brand’s earnings by 2023 are to be achieved in the areas of personnel costs, procurement incidentals and material overheads.

The company is working to increase productivity across all sites by 30 percent by 2025. With a six percent increase, the annual target of five percent will be exceeded this year. Some Volkswagen plants are currently well above the average, such as Bratislava in Slovakia, Palmela in Portugal and Uitenhage in South Africa. Andreas Tostmann explains that the fact that other plants have not yet achieved the targets set is due to far-reaching transformation processes.

The plant in Zwickau, for example, will be completely converted to the production of electric vehicles such as the ID.31. In the coming years, the Emden plant will also be converted to the production of cars based on the modular electric drive matrix (MEB), with Volkswagen planning investments of around one billion euros. “Of course, we will use what we have built up in Zwickau in Emden,” says Tostmann. The Chinese plants Foshan and Anting and the US plant in Chattanooga will also produce MEB vehicles. Volkswagen has now bundled production of the Golf in Wolfsburg, where production of the new Golf has already started. “This is on the start-up curve that we have set ourselves," comments Andreas Tostmann on the start of production.

Aligning to common production standards

It is particularly important for Volkswagen to align all its plants worldwide with common production standards, with very different requirements. A central procedure ensures that ideas and improvements at one location are quickly and bindingly transferred to other plants. 220 such measures are currently being implemented. These range from the globally uniform automated surface inspection in the paint shop to the reduced complexity of pressing tools in body production to modular special containers that can be used regardless of the model.

The new digital production platform developed with Amazon Web Services (AWS) and Siemens will also help to implement common standards, standardizing the various IT systems at the plants. For example, the maintenance of production machines can be uniformly controlled as part of predictive maintenance. “In a large company like Volkswagen, we have to use economies of scale much more consistently,” says Board member for production, Tostmann. Improvements must be implemented quickly everywhere, and new systems developed only once.

“We will continue along our chosen path,” Andreas Tostmann assures us. “Especially in a time of global economic uncertainties, we are well advised to make ourselves crisis-proof. To do what is in our hands so we are prepared for what is not in our hands.”