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VW boss Blume promises ‘affordable mobility for generations’

Broadcast United News Desk
VW boss Blume promises ‘affordable mobility for generations’

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Volkswagen boss Oliver Blume wants to present his strategy for the next decade this year. At the carmaker’s virtual shareholder meeting in Wolfsburg on Wednesday, the manager said the foundations for the 2035 strategy will be laid in 2024. “It will be the North Star for the actions over the next ten years,” Blume stressed.

This year, the Wolfsburg-based company will bring more than 30 new cars from different brands to the market, including combustion engines, hybrids and electric cars. Blum said the latter are the future of the automotive industry and the focus of investment. Small cars will cost around 20,000 euros, and another electric car will be added from 2027. “We are committed to providing affordable mobility for generations,” Blum said.

The vehicle will be developed and manufactured in Europe

The car will be developed and manufactured in Europe, but Volkswagen has not initially decided where it will roll off the assembly line. It is conceivable that Volkswagen will build a plant in Eastern Europe. For some investors, the decision comes too late. Janne Werning, an expert at the fund company Union Investment, said that given the product portfolio, it is difficult to massively increase the proportion of electric vehicles to comply with the EU’s tightening CO2 emissions targets from 2017 to 2025. “Brussels is now threatening to impose billions of dollars in fines.”

Blume also announced that commercial vehicle manufacturer Traton will be granted a higher free float, thereby increasing its chances of being included in MDax. Blume said that Traton’s low free float remains a barrier for many investors. In the medium term, Volkswagen plans to continue to hold 75% of Traton’s shares and 1 share. Blume stressed: “We want to continue to be a loyal and responsible shareholder.” However, he did not disclose how many shares Volkswagen could bring to the market. Currently, Traton’s free float is only ten percent.

Critical Voices

The human rights situation in China’s Uighur Xinjiang province remains a significant issue for shareholder criticism. Warning said suspicions that Blum was only perfunctorily dealing with the issue arose after reports of forced labour during the construction of the test track. Volkswagen Legal Director Manfred Doss said Volkswagen agreed with its Chinese partners that fundamental rights must be respected and this also applies to the joint venture in Xinjiang. Volkswagen operates a plant in Xinjiang together with SAIC. Volkswagen is in intensive discussions with its partner SAIC on the future direction of its business activities in Xinjiang; various options are currently being studied in depth.

The virtual shareholder meeting has also been criticized. In 2023, Volkswagen was seen as a positive example with its live shareholder meeting, says Deka expert Ingo Speich. Now the company is avoiding shareholders. Last year, human rights groups and climate activists disrupted the event; someone tried to throw a cake at Supervisory Board member Wolfgang Porsche. Volkswagen cited cost reasons for now holding the Annual General Meeting virtually again as well as security reasons. For the 2023 Annual General Meeting, Volkswagen was granted the basic right to hold the event virtually for five years. The format of next year’s shareholder meeting has not yet been decided, a spokesman said.

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