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VW’s Boss Warns the Troops: We Don’t Want to End Up Like Nokia

Herbert Diess on the make-or-break shifts the world’s biggest carmaker must pull off in the midst of a pandemic.

Volkswagen CEO Herbert Diess.

Volkswagen CEO Herbert Diess.

Photographer: Simon Dawson/Bloomberg

Volkswagen AG is at a critical juncture. It has weathered the pandemic relatively well but is fretting about cases going up again. It has electric cars rolling out but is well behind Tesla Inc. And it has massive manufacturing scale but desperately needs to rethink its vehicles as rolling software devices.

It’s this last issue that Chief Executive Officer Herbert Diess drives home with VW’s more than 635,000 employees. The transition in competencies from industrial might to software prowess will be an immense challenge for automakers that are vast, deliberate and some say ripe for disruption. Car companies that get it wrong risk ending up like Nokia Oyjfailed hardware makers doomed by more nimble and technologically adept upstarts.