VEHICLE PRODUCTION LOCATIONS OF THE VOLKSWAGEN GROUP
Share of total production 2009 in percent
2009 saw a large number of vehicle start-ups and hard work at our new production facilities. The Volkswagen Group now comprises 60 sites, with vehicles manufactured at 40 of these. As the Brazilian commercial vehicles business was sold to the MAN Group in the first quarter of 2009, the Brazilian plant in Resende has been deconsolidated. The commissioning of the facility in Pune, India, gave us a second production plant in the important Indian market alongside Aurangabad as of March 31, 2009. The activities of Auto5000 GmbH were integrated into Volkswagen AG in fiscal year 2009. Construction in Chattanooga, USA, is progressing as planned. This new plant will enhance the Group’s production facilities from 2011 and contribute to Volkswagen’s growth in North America. The Volkswagen Group is responding to the continued high demand on the passenger car market in China with the acquisition of the production facilities in Nanjing and Chengdu by our Chinese joint ventures. The Volkswagen Passenger Cars and Audi brands will substantially increase their production capacity to cement and expand their lead in the Chinese market.
Start-ups in 2009
There were numerous production start-ups in fiscal year 2009 that were central to the success of the Volkswagen Group. The launch of the fifth generation of the Polo was an important event for the Volkswagen Passenger Cars brand in 2009. The model range of the new Golf was also enriched by the Golf Plus and Golf Variant derivatives. Audi expanded its product portfolio in early 2009 by adding the Audi A4 allroad quattro and the Audi A5 Cabriolet, followed by the Audi A5 Sportback. 2009 also saw the start of production of the Audi R8 Spyder and the new Audi A8, both of which are eagerly awaited in the market. The start-up of the Yeti SUV and the Superb Estate were high points of the year for the Škoda brand. SEAT rolled out the Exeo ST in 2009. Volkswagen Commercial Vehicles added two new, attractive models to its portfolio: the Amarok produced in Argentina and the revamped Multivan/Transporter. The Bugatti Veyron Grand Sport* raised the bar in the luxury segment. The special needs of Chinese customers were taken into account with the start-up of the Passat Lingyu. In addition, local production of several more of the Group’s models began in China: the new Golf, the Tiguan, the Škoda Superb and the Audi Q5.
Center of Excellence for Automotive Production
In 2008, Volkswagen and the Fraunhofer Institute for Machine Tools and Forming Technology in Chemnitz signed a cooperation agreement to establish the Center of Excellence for Automotive Production. Designed to implement numerous innovative research topics for sustainable, resource-saving production, the alliance is a long-term strategic partnership. Volkswagen is participating by contributing manpower and materials with a value of up to €2 million. At the moment, seven research projects in the fields of toolmaking, body construction and technology development are underway. The Center of Excellence will gradually map the principal production units in body production. This will enable our experts to test new manufacturing processes up to series production on production lines and continuously improve them before being used in plants. An important part of the cooperation agreement is the initial training and continuing development of highly qualified junior scientists. Volkswagen employees will also be given the opportunity to test new production methods in the testing facilities of the shared “Forschungsfabrik” research laboratory, training themselves in the process.
Production milestones in 2009
The year kicked off with the one millionth Touran rolling off the assembly line in Wolfsburg in January. In May 2009, the Audi brand saw its global production exceed 19 million vehicles. By mid-year, Volkswagen Commercial Vehicles had produced one million Multivans/Transporters of the fifth generation as well as ten million vehicles from the Multivan/Transporter model range – all in all two reasons to celebrate. In July, SEAT celebrated the production of the nine millionth gearbox at its facilities in Spain. The Russian site in Kaluga assembled the hundred thousandth partly knocked-down vehicle in August, the same month in which the Changchun plant operated by our Chinese joint venture FAW Volkswagen produced the three millionth vehicle. At Shanghai Volkswagen, the five millionth vehicle rolled off the production line in the fourth quarter of the year.
Efficient production management in a rocky market
2009 was a year marked by the fallout of the financial and economic crisis as well as international measures to prop up and stabilize the sales markets. The volatility of customer demand presented the European locations in particular with major challenges with regard to staffing and security of supplies. This affected the Group’s production facilities to varying degrees, depending on the development of demand in the market and for the products in question.
Whereas the production facilities manufacturing the Polo, Golf and Golf Plus models as well as the Škoda Fabia and SEAT Ibiza were stretched to the limits of their capacity to meet the continued high demand in the compact vehicle segment, the facilities producing cars for the premium and luxury segments were among those forced to radically scale back production. Given the impact this had on staffing, it was necessary to introduce special shifts and short-time working in 2009 in close consultation with the employee representatives. In June 2009, Scania agreed on a four-day week for some 12,000 employees in Sweden in response to weak demand in the commercial vehicle sector. The agreement was valid during the second half of 2009 and involved a 10% pay reduction.
Because we continuously adjust production to developments in the market and are remarkably flexible, we succeeded in captivating customers with our young, appealing product portfolio during recent months in spite of the difficult situation, dramatically reducing stock levels at the same time.
By working hand in hand with the Sales and Procurement divisions, we will further stabilize operations at our production facilities to reach ideal stock levels.
Our superb product portfolio and the Group’s network of service providers will cushion the effects of the phasing-out of government incentive programs on the Volkswagen Group. Intelligently scheduled customer orders and our ample tools for achieving flexible working practices will again provide the key in 2010 for demand-driven production with minimum costs and optimized liquidity.