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Volkswagen to beat Toyota with quality & beauty

Strategy 2018, a plan devised by VW to become the No.1 manufacturer is counting on “German perfectionism and better design” as VW’s advantages over its Japanese competitor.

Alborz Fallah

14:0011 December 2007

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Volkswagen to beat Toyota with quality & beauty

Volkswagen group CEO Martin Winterkorn is counting on the German attention to detail as well as better looking cars to help his company beat Toyota as the global No. 1 within 10 years.

Volkswagen not only aims to beat Toyota in terms of overall sales, but also productivity and profitability.

According to sources inside Volkswagen, the company actually believes a sales supremacy can be achieved as early as 2014, but Mr Winterkorn would not comment on that issue.

“I cannot discuss internal goals. But we want to be in 2010 where Toyota is now.” Said Winterkorn

This year Volkswagen is expected to sell 6 million cars, an increase of 300,000 from last year. Toyota sales figures for this year are still not confirmed, however the Japanese company managed to move 8.8 million cars in 2006.

Going by those figures Volkswagen will need to increase sales and productivity by a staggering 10% a year to match Toyota’s manufacturing efficiency. Winterkorn is well aware that Toyota produce cars at a lower cost:

“Every Toyota produced in Japan has a cost advantage over VW of €3,000 ($7,000 AUD) to €4,000 ($9,250 AUD)” he told Automotive News Europe.

Talk of product efficiency instils fear of dull and lifeless cars coming out of Volkswagen, but with the company's acknowledgement of better looking cars as one of its strengths, we should not fear another Big T.

More importantly, with Volkswagen investing considerable amounts of money into the likes of Lamborghini and Bugatti, it would be a mistake to class Volkswagen as an A->B manufacturer.

Nonetheless, there is talk of a more efficient management with VW Group production chief Jochem Heizmann noting “production lines will become shorter and processes quicker.”

Volkswagen seems to be following a slightly different strategy to Toyota with the company planning to invest $22 billion (AUD) in the next three years for the development of 20 new cars.

One thing Toyota has done well in the last decade is produce cars specifically for our North American friends while the Europeans have tried and mostly failed to make headway with European models. But that is all about to change.

“We added too many technical items that [American] consumers don’t want to pay for, because they don’t need them,” Winterkorn Said.

As an example he cited collapsible external mirrors that are useful in narrow European streets and parking lots but serve little purpose in North America.

Part of the big push will come from Volkswagen's new family of small cars, expected to sell 1 million units a year. Cars such as the Up have a lot to live up to.

Do you think Volkswagen will turn into Toyota? More importantly, with challengers such as Hyundai lurking in the background, will the people's car achieve its aim of world dominance by 2018?