Volkswagen plans to reduce the number of Mk8 Golf variants in an attempt to make it more cost-effective
Jim Holder
26 October 2016

The new Volkswagen Golf, which is due to be unveiled next month before going on sale next year, will not be available in as many variants as it is now, as the scandal-hit firm focuses on increasing profit margins, boss Herbert Diess has revealed to Autocar.

VW’s operating profit margins are famously slim and dipped to 1.7% in the first half of this year. Diess has already signalled his intent to turn that around, both by renegotiating labour and supplier deals and by reducing the complexity of model line-ups.

“We need to simplify the product offering of the next Golf and have fewer variants, because we have got to get more cost-effectiveness into our company,” said Diess. “We need to be more agile and more innovative, and this is one example.”

The current Golf is available in hatch, estate, convertible, Alltrack and SV bodystyles. Diess did not specify which were likely to be cut, but the recent decision to stop selling the convertible in the UK — traditionally one of the stronger markets for open-top cars — is believed to give an indication of the plan to focus on core models in future.

Diess is said to have pushed engineers and managers to reduce the expense of the MQB architecture on which the Golf sits, believing it has been over-engineered for the price points of the vehicles it underpins. It is also possible that the powertrain line-ups will be rationalised, with a greater emphasis expected on new mild hybrid 48V powertrains.

Diess’s push to raise margins is also believed to be a result of growing concerns that the firm’s £1.5 billion investment in a far-reaching electric car strategy — based around the newly developed MEB platform on which the Paris motor show ID concept was based — will put further pressure on the company’s profitabilty.

“One of the biggest hurdles we still have to take is a new deal with the unions,” said Diess. “I am looking for higher productivity and to restructure the value chain to focus on new technology. We are talking, and I hope we can have an agreed plan to have a fix in place by 2020.”

Diess is also reported to have accelerated VW’s plans to launch more SUVs, which are more profitable and have a wider global appeal than other bodystyles. This is expected to include a Polo-based Nissan Juke rival, a Golf-based SUV to sit below the Tiguan and a large seven-seater aimed at the US and Asian markets. “We will add some higher-contribution products as we prepare for 2020 onwards, when we will have a clear indication of our future,” said Diess.

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Comments
16

26 October 2016
Isn't the Tiguan Golf based already? How will they make it any cheaper to make?

26 October 2016
Totally makes sense. How many Golf Pluses (or SV) estates and convertibles do you see on the street in the UK? Almost non. I always wondered how these made any financial sense. I presumed VW was experimenting to see what might sell.

26 October 2016
The UK market is significant for VW but you can't make any assumptions based on the cars you see sold here or UK market tastes. As the article points out, the U.K. is a significant market for convertibles and they dropped that model.

26 October 2016
Thats what I mean. How many Golf comvertibles have you seen in the UK? Honestly I see more Ferrari F430's than Golf convertibles, SV's and estates combined. In my travels in Europe and China I have seen very few of any of the variants I mentioned above. They dont even sell them in the States. The vast majority are hatchbacks. Will have a look at the stats to see if they back up what im saying.

26 October 2016
I tell a lie, they introduced the Golf estate to the USA late last year.

26 October 2016
Both the Alltrack and Convertible should go, I didn't even know there was an Alltrack Golf. So I checked and between Apr and Jun there where just 190 sold.

 

Hydrogen cars just went POP

26 October 2016
Gosh, the Golf SV sold around 100k in 2015 in Europe alone according to left-lane.com. That one variant sold about half the numbers of the Vauxhall Astra at around 200k. That's a lot of cars. I'll shut up now.

26 October 2016
'Scandal hit firm' decides world needs more SUVs. When will it end?

26 October 2016
For the past 20 years VW has been championing the platform sharing which has seen everything from TT to Octavia spun from the basic Golf platform, claiming the commonality allows variants to be economically engineered and maximising profits even on variants with relatively low sales.

Suddenly they're performing a volte face?

26 October 2016
Diess has quite a job restructuring a large old company that is more complicated than many a political parties. As for Golf, given its high asking price but low monthly instalments, Volkswagen should perhaps only sell the high end versions. Chopping off entry level cars would save costs and could allow Golf to be accepted as 'premium offering' and improve its common as housefly image. Volkswagen has MPVs so no room for Golf SV. Nobody can tell them apart anyway. Tiguan leaves no justification for all track. Skoda erases the need for estate version. Convertible is already being chopped. Easier said than done though. I do not envy Diess.

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