Volkswagen Sees Several ‘Tough’ Years of Restructuring Ahead

  • VW Brand Chief Diess says ‘hard work’ will be finished by 2020
  • Cars for new automotive age target the likes of Apple, Tesla

VW’s Diess Sees ‘Hard’ Restructuring Work Done by 2020

Volkswagen AG said it will take years to overhaul its namesake brand tarnished by the diesel-cheating scandal before returning to what unit chief Herbert Diess called the “good times,” when cars like the I.D. electric concept hit the market.

By 2020, “we will have finished the hard work,” Diess said Thursday in a Bloomberg TV interview at the Paris Motor Show. “We have three to four tough years ahead of us to really restructure the company and getting more profitable and more competitive.”

Herbert Diess speaks beside VW’s I.D. concept electric car on Sept. 29.

Photographer: Jasper Juinen/Bloomberg

Volkswagen has been using the emissions-cheating scandal as a catalyst for deeper reforms. The VW brand, the German carmaker’s biggest unit, was struggling even before the crisis, and the company is now in discussions with unions over concessions in exchange for investment guarantees and agreements to retrain workers in the transition away from traditional combustion engines.

For more news on the Paris Motor Show, click here

The I.D. concept is a flag bearer for VW’s new direction. The battery-powered hatchback, which Volkswagen is likening to groundbreaking models like the Beetle and the Golf, boasts a range almost twice as far as Tesla Motors Inc.’s Model 3 sedan.

As part of the transformation, Volkswagen is also pushing into services like ride-hailing and self-driving shuttles. The company said the new services division would be its 13th brand, putting it on the same footing as Audi, Porsche and Skoda and underscoring its ambitions. The shift in direction puts Volkswagen on collision course with a new kind of competitor.

“We are mainly targeting with this new product -- which is always online and only electric -- the new competitors like Tesla could be or Apple might be or some others,” said Diess, who joined Volkswagen from BMW AG a few months before the crisis erupted in September 2015. “The good times will start with the new age of mobility.”

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