Although Nokia has officially returned, the brand has not been able to compare with itself in the heyday of the 90s and early 2000s.
The 2000s saw a dramatic change in the mobile phone market. The first is the fall of the Nokia empire and the second is the rise of Apple. So far, this is still a stage that no one can forget. It is for ordinary observers, and senior management of a leading car manufacturer like VW sees more than that. According to recent sharing, Herbert Diess – CEO of VW Group said that if not accelerate the reform process, this group could fall into the same situation as the giant from Sweden.
Currently, there are many technology companies, both startups to big companies are focusing on resources for self-driving cars as well as many other car technologies. This creates a pressure for car manufacturers to not stand by and be dragged into the race with expensive research and development projects. And the VW Group is no exception. “Are we fast enough or not? If we maintain the current pace, everything will be very difficult. ”- that is his concern in the current context.
Reuters said VW is in the process of shifting from producing traditional cars to high-tech products such as self-driving cars or connected cars. Mr. Diess said that one of the requirements at the moment is to cut costs and improve efficiency. He also asserted: “The era of classic car manufacturers has ended.”
In addition to the race against the technology world, VW, like many other car companies, is facing increasing pressure from emissions regulations. In the proposed solutions, the production of electric vehicles, especially battery electric vehicles, is considered an inevitable direction. From here, another headache appeared. Because, regardless of the pressure, they still have to ensure profit – an extremely difficult problem when the interest in electric vehicles is not commensurate with expectations.
Once again, Mr. Diess emphasized that it is imperative to simplify, cut costs and increase productivity. Also according to Reuters, VW will reduce resources for fuel cell fuel cell technology because they think the technology is less competitive than electric motors running on batteries, at least in 10 years. At the same time, VW also cut costs for the MOIA service. Profits will be a top priority, not a quantity.
To prove his point, he took Bentley as an example. According to Mr. Diess, the profit margin of this brand is quite low and makes the achievement of 10,000 delivered cars become less impressive. The CEO affirmed that it would be better to sell 5000 cars but at a rate of 20% rather than selling so much that the profits are not much.
Finally, Mr. Diess points out that VW needs to focus on its strengths, avoid shortcomings and abandon anything that could hinder the goal of boosting the performance of the whole machine. Listing of Traton truck brands is only the first step in the group’s super-reform plan. Another goal that VW has set is to increase the value from 91 billion EUR at the present time to 200 billion EUR.
Mr. Diess’s sharing once again confirms the difficulties and complexities that the global automobile industry is experiencing. It is not by chance that he took Nokia’s case as an example. But overall, the situation of VW or other car groups is probably much more difficult than Nokia more than 10 years ago. Because apart from the competition and challenges from new competitors, all are miserable with suspended penalties above their heads if they do not meet the new emissions standards.