Archives – December 9, 2016

Porsche and Audi Vying With Volkswagen over Electric Vehicle Leadership

Audi e-Tron

Audi e-Tron

In-house fighting has ignited rivalry between the premium brands of Volkswagen, Porsche and Audi. Volkswagen is cutting costs following the scandal on diesel emissions cheating. Senior executives responded to Reuters concerning the internal conflict revolving around the manufacture and development of electric cars. The automaker is emerging from the hyped “Dieselgate” scandal. The international racing events analogy, which includes Le Mans 24, was used by Reuters. This analogy describes the rivalry within the automaker that will manufacture its plug-in car models. Volkswagen denied the rumor that the rivalry in question is beyond control in the boardroom.

The battle for resources is cut-throat. Every car manufacturer with the capacity to build engines is now interested in a leadership role. This leadership concerns battery packs, battery-cell and electric-motor expertise. This information was provided by one of the executives of a Volkswagen division that wanted their name to be kept anonymous. Cost cutting will also involve a dramatic reduction of jobs as the automaker faces lawsuits and penalties accrued from the Dieselgate scandal. This could affect all brands including Bentley, Bugatti, Lamborghini, SEAT, and Skoda. The company and its union came to an agreement recently to reduce thirty thousand jobs at VW brand’s core. This will be in place of a commitment so as to avoid forced redundancies.

The ambitious goal by Volkswagen to launch up to thirty new electric car models by the year 2025 will also have impact on labor. Assembling of electric vehicles is less complex compared to conventional combustion engine cars. Additionally, fewer workers will be required to assemble. The issue will be thorny, particularly in an industry that is dominated by workers who have numerous collective wage agreements. Audi, Porsche and VW executives who did not want their names revealed, said the conflict in question was not a new phenomenon. They further added that healthy internal competition is great since it would trigger greater commercial and technical achievements. Based on a reliable source, leadership changes effected in the last year have thrown that off.

The corporate office of Volkswagen dismissed the above comments and denied there being any power struggle. It claimed that the reports were pure speculation with no foundation. Although Audi has in the past been making huge profits, it has been a loser in some internal battles that cropped up in recent years, especially following the development of car components for the Porsche brand. We just have to wait and see which automaker will eventually take the leadership role.

 

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Toyota Starts a New Electric-Vehicle Project

Toyota Prius

Toyota Prius

Toyota Motor Corporation is trying to follow the footsteps of Tesla Motors, Nissan Motor and General Motors in the development of electric cars. Toyota is well-known for the production of hybrid cars that utilize traditional engines, and it has been skeptical of delving into the fully electric car market. Instead, it has been investing in researching on hydrogen fuel-cells. The automaker’s president, Akio Toyoda, who was in charge of branding the luxury division of Lexus, will oversee the newly set-up electric car Department of Business, planning alongside other executives. The push for electric cars follows Toyota’s president’s move to increase autonomous car research.

A one million dollar investment has been made on the project with several employees hired in Silicon Valley. Toyota, which is the largest car maker globally in terms of profit and sales, has substantial financial resources to utilize in future projects. Meanwhile, Volkswagen AG, its primary competitor has settlement costs and fines amounting to billions of dollars in relation to cheating on emissions tests in the United States. Mr. Toyoda, who is the grandson of the automaker’s founder, has plans of manufacturing cars that can drive themselves by the year 2020. However, Toyota has a likelihood of engineering vehicles that require driver engagement in the operation process.

While the pioneering work of Google on autonomous cars has resulted in a great investment in driverless-car research, electric-car research is also making progress. It is essential for automakers to react to the current regulatory and emission pressures that are overshadowing the lack of demand for battery cars such as BMW i3 and Nissan Leaf. Although Toyota has been focusing more on fuel cells, the automaker seemed to be interested in joining the electric car market many years ago. Toyota started by investing in Tesla in 2010 before launching the Model S electric car sedan. Toyota made an agreement with Tesla to purchase batteries from Tesla, a deal which ended following disagreements between Toyota and Elon Musk.

Toyota still has plans of selling thirty thousand fuel-celled cars per year by 2020, which will coincide with Tokyo’s Summer Olympics. But there are some challenges currently faced. For instance, there have been delays in constructing hydrogen refueling stations, especially in California. This has hampered the sales of Mirai’s fuel-cell car. Recently, Toyota announced that it had plans of setting up a unit for building a battery-powered vehicle that will be marketed quickly. This move has come at a time when the Prius hybrid car sales have been declining in the United States.

 

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