Can Audi achieve its transformation in the cold winter with a large number of layoffs and high-level air drops from BMW?

Posted 2024-03-16 00:00:00 +0000 UTC

Two years later, the board of directors once again "changed blood", and this time, it was a parachute outside the system. Not long ago, Audi officially announced that Marcus duzman, the former global director in charge of procurement, will replace Bram schot and officially become the chairman and CEO of Audi's board of directors on April 1, 2020, with three new directors taking office at the same time. In a group with complex internal relations, every change of management is a bloodbath. In recent years, Audi has been changing constantly. It seems unexpected to introduce a BMW team without "baggage", but it is also reasonable. The world's automobile industry is in decline, and every penny of expenditure should be calculated carefully. Because of this, Audi obviously takes a fancy to duzman's experience as a purchasing director and a series of electrification projects he once led, which can be said to be a good calculation. After the "diesel emission gate" event in 2015, Volkswagen Group accelerated the pace of electrification. Audi plans to invest 40 billion euros in advance by the end of 2023, including fixed assets, plant equipment and technology research and development, of which about 14 billion euros will be used in electric travel, digital and high-level fields. Under the cold winter, in the process of a series of investment in the future, every sum of money will be spent on the blade. As CEO of Volkswagen Group, this is clearly what Herbert diess, known as the "cost killer", most values. Another reason may be the origin of duzman and dis. In April 2018, the former CEO of Volkswagen brand, who succeeded Matthias Mueller to become the new CEO of Volkswagen Group, is from BMW, and the time he joined is 2015 when the diesel door broke out. Marcus duzman will officially become the chairman and CEO of Audi's board of directors on April 1, 2020. His joining has also become the third BMW executive who joined the Volkswagen Group after Didier. In January, VW announced that Hildegard Wortmann, a former BMW executive, was in charge of Audi's sales and marketing efforts from July 1. In addition to the change of the board of directors, another event happened at Audi in the same period was the layoff of up to 9500 people. It's not only the company that holds on to its wallet for the winter. Layoffs have become the theme of this century old industry. Standing at the node of technological change, let's see what happened at Audi. In recent years, influenced by the "exhaust valve" of diesel vehicles of Volkswagen Group, Audi's senior management has been constantly shaking. In June 2018, Rupert Stadler, a former Audi CEO, was arrested by prosecutors in Munich, Germany, for trying to hide evidence related to diesel emission investigation. The impact of this incident on Audi is self-evident. Later, Audi urgently promoted Bram schot to interim CEO. Thanks to Sauter's efforts, Audi's relationship between dealers in China and Germany has improved significantly. But only 17 months later, Sauter could not get rid of the fate of being replaced. During more than one year of working as CEO of Sauter, Audi's financial revenue failed to make a substantial breakthrough. As a car executive with sales background, Sauter seems to have been not the best choice for Audi. In the eyes of the outside world, Schott's working experience in sales also doomed his short time in the CEO position. In contrast, duzman, 50, has already turned to two luxury brands, BMW, in less than 30 years of work experience. The rich experience of luxury brands seems to make duzman the most suitable "receiver". Duzman, an engineer, joined BMW Group in 2007. He was responsible for the research and development of BMW powertrain, as the driving dynamics director and powertrain director. In July 2016, due to his outstanding work, duzman officially served as the director of BMW Group, responsible for BMW's global procurement and supplier network. During his tenure, duzman led the cooperation between BMW Group and established the purchase intention of power core worth 4 billion euros. His intention is very clear: to ensure the leading position in the field of electric travel, car companies must continue to extend to the upstream of the value chain industry. Today, from the production of upstream electric core, vehicle production to the downstream electric travel, BMW has opened the entire value chain - which is undoubtedly the envy of other car companies. Another data is that in 2018, BMW sold 142617 BMW electric vehicles and mini electric vehicles globally, an increase of 38.4% compared with the previous year. It is said that Audi spent a whole year digging for duzman. The new CEO, who is also highly expected by Disneyland, may lead the process of Audi's electrification. On the way of transformation in the cold winter, in addition to the change of the board of directors, Audi's layoff has attracted widespread attention. Recently, Audi announced that it will cut 9500 people, about one tenth of the company's population, by 2025 to save 6 billion euros for the transformation to electrification and digitalization. Audi said in the statement: "the company must be streamlined to adapt to the future, which means the company no longer needs some jobs..." The job cuts will include management positions and will be carried out along the demographic curve through employee mobility and early retirement plans to ensure that the company maintains a profit margin of 9.0% to 11%. "In turbulent times, we are making Audi more agile and efficient, which will increase productivity and enhance the sustainable competitiveness of German factories," Schott said Under the influence of the downward environment of the automobile market, the profit space of the automobile enterprises has been compressed, and layoffs are becoming the main theme of the major automobile enterprises. But Audi is not the only company to do so. In the luxury car sector, BMW and Mercedes Benz, which are in the same echelon, have also announced layoffs. Daimler has announced that it will cut thousands of jobs in the next three years to cut employee costs by 1.4 billion euros (10.8 billion yuan) in 2022, and BMW plans to cut 5000 to 6000 jobs by 2022. Under the trend of electrification, major vehicle enterprises are actively expanding their distribution, and Mercedes Benz, BMW and Audi are also engaged in fierce battles in this field. Audi, accustomed to being compared by the outside world, has also been under the pressure of "the other two" from BBA for a long time. Among the top three German companies, the competition has become increasingly fierce, which makes Audi under increasing pressure. Audi, which has won many sales titles, is on the decline, ranking third in the first three quarters of 2019. Internally, Audi is under a lot of pressure. As an important brand of Volkswagen, Audi plays an important role. According to the 2018 financial report of Volkswagen Group, Audi and are the main source of revenue of Volkswagen Group, with operating profit of 4.7 billion euros and 4.1 billion euros respectively, accounting for 63.2% of the group's total profit. In the third quarter report of 2019 issued by Volkswagen Group, Audi's global sales revenue in the first three quarters was 41.332 billion euros, down 6.61% from 44.257 billion euros. Compared with passenger cars and Porsche, its operating profit is in a downward trend. In 2018, Audi's sales in the world dropped sharply. Only in Chinese mainland and Hongkong market did the market grow by 10.9%. Volkswagen even expressed its dissatisfaction. Looking at the global market, the competition among luxury brands is one after another. There are many brands like this that stand out, achieve positive growth for 14 consecutive years, and become the new sales champion in the second tier luxury brand car market. Although there is a big difference between Lexus and BBA at present, and the monthly sales volume does not exceed 20000, but from the perspective of development potential, the upward force of this brand cannot be ignored. Not only for luxury brands, GM plans to launch at least 20 new all electric and battery vehicles worldwide by 2023. One third of the company's internal combustion engine expenditure is planned to be turned to vehicle electrification, and it is planned to fully realize electrification in 2022. VW plans to reach 22 million electric vehicles in 2028. Audi's position in the Volkswagen brand is obvious to all. On the road of transformation, Audi has to bear a distinctive banner to withstand the pressure. Focusing on Audi's market, the electric anxiety of luxury car brand BBA is more obvious. Different from the new force vehicle enterprises, "BBA" is facing a transition in the volume of the original fuel vehicles, with a heavy sense of historical burden, and the original brand tonality needs to be redefined. For the layout of new energy vehicles, BMW seems to be in the forefront. Back in 1972, BMW launched its first model, 1602e, in response to the oil crisis. In 2011, BMW I sub brand was released, which was also regarded as the starting point of its transformation to the field of electric travel. By the end of 2018, BMW has sold more than 350000 new energy vehicles in the world, and more than 140000 electric vehicles in 2018. Audi is relatively late in electrification. At present, there is only one pure electric vehicle, which has been left behind by, or even BMW. In terms of electrification, Audi can make use of the MEB and PPE platforms of the Volkswagen Group, but the help provided by the platform still needs time to land. However, the time has come for Audi to find new selling points. Of course, Audi doesn't have no competitive advantage at all. After the acquisition of duzman, the internal blood exchange may really start. Backed by Volkswagen Group, Audi can quickly achieve complementary advantages and obtain all resources that can be mobilized. At present, Audi's focus is changing from sales growth to sales quality improvement. It can be seen that in the continuous downturn of sales volume, Audi's intention is to make progress by retreating. Instead of blindly pursuing sales growth in the increasingly bad market environment, it is better to revise its pace and move towards transformation. For duzman, the new leadership team needs more trial and error. Can duzman deliver a satisfactory report card? Whether Audi can go further and further on the road of transformation and electrification is still unknown. There are many stories to be told by Audi in the future.

Copyright © 2020. TUTESL All rights reserved.