start your engines
Posted by Dale Buss on September 21, 2011 12:05 PM
They aren't exactly hurling bratwursts at one another yet, but the Big Three auto makers of Germany — Volkswagen, Daimler and BMW — certainly are ratcheting up the world-domination rhetoric these days. From their rosy projections and concomitant saber-rattling, you wouldn't know that these companies will be challenged as their German taxes help to bail out a bankrupt Greece for the next several years, or as the global economy continues to teeter on the precipice of a double-dip recession.
Volkswagen — with hopes high for the 2012 VW Beetle — plans to sink $86 billion over the next five years into plants, vehicles and R&D to bolster its much-discussed bid to overtake Toyota in global sales volume by 2018. Those projected outlays are up a tad from what VW previously was planning. The company "is investing a record amount in forward-looking projects to achieve its goal of becoming the world's best automobile manufacturer," CEO Martin Winterkorn stated in an announcement timed to last week's Frankfurt Auto Show.
One likely landing spot for an increase is its new U.S. manufacturing operations in Tennesee. Getting a much bigger share of the American market — despite its maturity and how highly competitive it is — is considered key to VW's plans for global domination. And Volkswagen of America CEO Jonathan Browning told brandchannel that the U.S. arm of the company is doing its part. "We can make sure we're offering vehicles and services that represent great values in the marketplace and really biuld on inherent strengths that consumers recognize" in the VW brand, he said.
Meanwhile, however, Daimler CEO Dieter Zetsche has been making his own declarations, telling employees in a letter that he wants "to make the next decade a 'Mercedes decade,'" according to Automotive News Europe. Citing a planned lineup of new Mercedes-Benz products and hopes that the long-term future of car sales will be bright, Zetsche reiterated that he wants Mercedes to be the best-selling premium brand in the world by the end of the current decade.
Fortunately for VW and Mercedes, while the former is pursuing mass, the latter is pursuing class, in terms of market segments. So there may be room for each of them to achieve their definition of market domination.
But Toyota, General Motors and even Hyundai stand in the way of Volkswagen, while BMW — currently leading the U.S. market in year-to-date luxury sales, for instance — believes that it will have a huge say in Mercedes' chances for success.