“So far, we have been too inflexible. Traditionally, we plan about ten years in advance,” said Thomas Schäfer, head of VW.
“For the new Passat, we are planning from the beginning for 80 percent of the maximum production volume,” he added.
This approach will also be implemented in all future models and is already part of the plant’s occupancy planning.
“If the markets are strong, we compensate for the missing 20 percent with additional shifts,” Schäfer noted. Model planning results in a demand forecast.
“For a high-end model, for example, sales expect 150,000 cars per year,” said the senior executive.
To be safe, production has been traditionally prepared for 170,000 vehicles.
However, if only 120,000 cars are ordered, there will be a significant excess capacity.
VW is now addressing this issue. If these cars are released into the market, residual values will decrease.
Schäfer explained the current challenges in electric car sales with the reduction of purchase incentives.
The main problem is that some European countries, such as Sweden and Germany, have reduced their funding, even in the fleet sector.
“This is not only something we notice in terms of order reception but also our competitors,” said the head of VW in an interview with Auto motor und Sport magazine.