Has Volkswagen Found the Holy Grail in car making?

How do you create a legacy the likes of Henry Ford, Alfred Sloan, and Taiichi Ohno? You have the name of Ulrich Hackenberg. Ulrich may not be a household name yet, but Volkswagen has placed a heavy price on his ideas to become the “holy grail” of car building. Auto engineer Hackenberg developed his idea for three decades and after being ignored throughout the industry; Volkswagen CEO Martin Winterkorn finally took hold of the ideas.

Hackenberg’s integral rethink of vehicle platforms is helping Volkswagen shoot to the top of global car sales charts several years ahead of the 2018 target. This can also make VW one of the most profitable car makers in the world. This is not without risk. It could very well expose Volkswagen to massive recalls if a single part, used world-wide, fails.

At a gathering in Japan five years ago, Renault and Nissan executives lifted the hoods on several VW Group vehicles side by side — including models from Skoda, Seat and Audi brands — and saw trouble. “They had the same engines, the same clutches, the same ventilation — all identical parts,” says an executive who attended the presentation. “It was a level of commonality that didn’t exist at Renault-Nissan.”

After 6 years of groundwork, VW has just begun to utilize its design platform. Labeled “MQB” is a German acronym for  “modular transverse matrix.” All of the small and medium front-wheel drive models will be designed around this base.  Michael Robinet, managing dirctor of IHS Consulting in Northville, Michigan stated that the MQB platform “really changes the game.” The new platform will support Volkswagen’s 12 brands including Audi, Skoda, Porsche, and Lamborghini. This may help VW take the sales crown from Toyota by next year.

The huge volumes of which VW will be able to produce on the MQB platform exposes the group to the same massive recalls faced by Toyota in the previous years. Analysts also voiced their concern about VW’s reliance on markets, such as China, for future growth. China now accounts for 30% of Volkswagen’s global sales. To create a bigger market exposure, VW overhauled its losses in the North America operations. The overhaul could more than double American sales by 2018.

VW has also had growth with it’s new Audi assembly plant in Mexico and there is a potential increase for the Chattanooga plant in Tennessee. The two plants will be updated to accommodate the new platform as well as the Golf in Puebla and the crossover in Chattanooga.

The full implementation of the new platform may not be completed until the end of the decade. By then the CEO Winterkorn and Chairman Piech may be retired, as of now new potential heirs have not been anointed, and it won’t be easy since the power has been held by Winterkorn and Piech since 2007.

Volkswagen, Wolfsburg Factory, Germany,

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