Volkswagen Boss: German Automotive Industry Needs to Learn from China

JAKARTA, KOMPAS.com - Chief Executive Officer (CEO) of Volkswagen, Oliver Blume, believes that the German automotive industry needs to learn from China’s approach to industrial planning, which he considers more disciplined and directed.

This statement reflects the pressures currently facing European manufacturers amid the rapid global transformation of the automotive industry, particularly in the Chinese market.

In an interview with Bild am Sonntag, quoted by Reuters, Blume stated that China implements industrial strategies systematically with clear priorities.

He assessed that China’s advantage lies not only in the scale of its market but also in its consistent execution capabilities at the industrial level.

“The very positive aspect we experience in China is the high level of discipline and willingness to execute,” said Blume.

According to him, industry players in Europe need to start looking at practices outside the region as references, especially in facing major changes such as vehicle electrification and digitalisation.

However, at the same time, this situation also poses challenges for Volkswagen. In the Chinese market, the company faces very tight competition with more than 150 players as well as rapidly moving innovations.

The decline occurred mainly in China, which recorded a contraction of 8 percent to 2.69 million units. Yet, this market has been the backbone of Volkswagen’s growth for years.

In contrast, performance in Europe and South America still shows growth of 4.5 percent and 11.6 percent, respectively.

Amid these conditions, Volkswagen is also undergoing a major transformation, including plans to cut around 50,000 jobs in Germany by 2030.

Nevertheless, the performance of electric vehicles in China remains subdued, in line with the company’s strategy to prepare new models based on local development to catch up with domestic producers.