Currently reading: Volkswagen boss: software is the next big challenge
Herbert Diess says the transition to fully connected cars is a bigger step than the electric revolution

The transition for Volkswagen cars becoming fully connected will be more challenging than the advent of electric powertrains, according to Volkswagen Group CEO Herbert Diess.

“We have the transition of drivetrains becoming electric," he said. "We want to be emissions-free and CO2-neutral by 2050. We have a plan and EVs are coming and they’re connected. That’s all nice. 

“But the next transition [to software] will be harder for us. It’s really skills we don’t own today. We have to create an entirely new set of skills and capabilities because the change into software is really radical for us. The car becomes an internet device that’s probably more complicated than a smartphone. We are only at the beginning.”

Volkswagen Group has recently appointed Christian Senger to a new position of board member for software, demonstrating how important this area is for the firm. “We’re making a big effort [in this area]," said Diess. "This is also the preparation for autonomous driving. It only works if you have cloud capabilities, data connections.”

Talking at a press conference with Microsoft, with which it has recently announced a partnership, Diess said that there is currently 10 million lines of code in cars, but such a number is small compared to what's to come. “Software capability is very limited today. In 2025, we will have three times more software in a car, and with autonomous driving, it will be 10 times more.”

He added that the differentiation between cars will be through software. “We have to become a software company, but it’s a long way away.”

Car firms are increasingly pairing up with third parties for their technology capabilities as the automotive industry evolves from a traditional car business model to one where technology is at the forefront of the services that are offered.

However, Diess said its choice to work with Microsoft was in part because it is a business-to-business company. “They don’t compete with us for the attention of the customer," he said. "They are trying to make us work and they will have a benefit from marking this happen.”

VW Group-owned Seat announced earlier this week that it would open an in-house software branch in the next 12 months. Digital officer Fabian Simmer told Autocar: “We should keep this know-how [in-house] and this is a means of differentiating us from other brands. When we’re looking at vehicle software or mobility services, why would we give that to a third party?”

Talking about the arrival of autonomous vehicles, Diess said he remained conservative. “I would say people are more conservative than they were two years ago on this. It will take a while. It really requires a lot of safety because you can’t risk lives with a machine. We have to be cautious. There’s a lot going on, a lot of development. I’m trying these cars worldwide. They are evolving and getting better but there’s still a lot to do.”

Back to top

Join the debate

Add a comment…
sidevalve 27 February 2019

Water ingress!

Unless they can learn to get the basics right, and I see no evidence that they can, they are going to be completely screwed. My Audi A6 had its transmission ECU in the passenger footwell, which not surprisingly was where the (considerable) amount of water that leaked in ended up. Perhaps they could start with learning to (for instance) hermetically seal or shrink wrap all their electronics, before they waste billions on software that will become unserviceable the first time it rains...
JMax18 28 February 2019

Autonomous cars are a long

Autonomous cars are a long way away yet. Then, how long will it take for them to completly take over? A lot, lot longer. It seems to me that VW are taking the right steps, though.


VanDyke 27 February 2019

Brand differentiation

Herr Diess talks of differentiation coming through software in future. I hope there’s more to it than that, because differentiation is a skill VW Group seems to have lost, going to hair-splitting lengths to try to separate an entire portfolio of vehicles which the world outside knows are exactly the same underneath the skin.

Look what’s happened in the mobile phone market: 2-3 brands left competing for attention in a market which is all about an identical rectangular screen.

Am I really going to be bothered what the brand is when I’m in an autonomous EV which I may not even own?

catnip 27 February 2019

VanDyke wrote:

VanDyke wrote:

Am I really going to be bothered what the brand is when I’m in an autonomous EV which I may not even own?

You won't be bothered at all, just like you're not bothered about who makes the bus or train you may go on. The car manufacturers know there'll be no need for most of them when autonomous vehicles are the norm, so they're making hay while the sun shines.

Jeremy 27 February 2019


They should concentrate on getting the software right on their current models before worrying about the future. I'm thinking about getting their DSG boxes to not have a hesitancy when they pull away.

sidevalve 27 February 2019

Rubbish VAG transmissions

My Audi's Tiptronic did that too, although I guess it could have been down to that that its ECU (as mentioned in my other comment) was usually sloshing around in a couple of inches of water that had overflowed from the heater plenum chamber...