VW To Cut Spending, Reorganize Diesel Strategy, Push Phaeton EV


Volkswagen is shaking things up all over the place in wake of its diesel emissions scandal and by shaking things up, we mean it’s overhauling the entire VW brand model strategy. Tuesday, the automaker announced plans to cut spending by $1 Billion, switch to a different, more expensive, diesel emissions technology, and push ahead into EV territory with a new electric Phaeton which it plans to make the company’s new flagship.

“The Volkswagen brand is repositioning itself for the future,” says CEO Dr. Herbert Diess. “We are becoming more efficient, we are giving our product range and our core technologies a new focus, and we are creating room for forward-looking technologies by speeding up the efficiency program.”

The changes come as Volkswagen finds itself in a tailspin after admitting that its diesels don’t meet U.S. emissions standards after all. The automaker in fact cheated on U.S. emissions tests for nine years by rigging software to spew out fake results during testing. So now the automaker says it’s decided it will switch to diesel drivetrains with selective catalytic reduction (SCR) and AdBlue technology in Europe and North America and that it will start to do so “as soon as possible.”  According to Automotive News, the tanks make diesel models heavier and more expensive, and they also must be refilled, making the cars less convenient to own.

Meanwhile, with diesel technology now getting more expensive, VW’s larger plan is to turn its focus to long-range EVs. The automaker says it plans to develop a new modular electric architecture dubbed MEB for compact vehicles for all group brands. This goes along with what we heard last month in Frankfurt, when VW said it would launch 20 battery-powered and plug-in hybrid vehicles by the end of the decade. That includes the first all-electric Porsche based on the Mission E concept and a production version of Audi’s e-tron Quattro concept.

What’s new is that the shift now includes redesigning the Phaeton as an all-electric model, as well. The current model’s gasoline and diesel versions will be axed.

“We are very aware that we can only implement these innovations for the future of the Volkswagen brand effectively if we succeed with our efficiency program and in giving our product range a new focus,” says Dr. Herbert Diess.

The next-generation Phaeton is due to hit showrooms by about 2019-2020.

Photo Credit: Volkswagen
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