How Big Is Volkswagen?
“Volkswagen” which means “People’s Car” is a German multinational automotive manufacturing company headquartered in Wolfsburg, Lower Saxony, Germany. It is known for manufacturing and distributing passenger and commercial vehicles, motorcycles, engines, and turbomachinery. Popular auto brands like Audi, Bentley, Bugatti, Lamborghini, Porsche, SEAT, Skoda, Ducati, MAN, Scania are all owned by Volkswagen! All of these brands are treated as stand-alone companies. They have their own boards of directors, their own profit & loss statements, and their own annual reports. They even have their own separate design, engineering and manufacturing facilities.
Volkswagen was founded in 1937 with a sole purpose to make a car for the common people as cars back in that day were extremely expensive and were limited to only the upper crest of the society. The Beetle was the brainchild of Ferdinand Porsche who was a mechanic’s son. Porsche was born in 1875 in Northern Bohemia (current Czech Republic). From the young age, he was a non-conformist and free thinker but possessed a brilliant mind for design. In 1900, as a teenager, he designed the world’s first front wheeled drive car. The Egger-Lohner electric vehicle.
His unorthodox front wheel drive concept won many design awards and even got accepted in higher echelon society. Austrian Archduke Franz Ferdinand owned one of the first Porsche early cars. Over the next decade the cleaned designer would leave his mind in market of racing, civilian cars and even aircraft engines which is designed for Austria during World War I. It doesn’t stop there, during this time he even created the first gasoline-electric hybrid car. Well, this would be a lifetime works for most but his real passion was in the vehicle for the common man. Cars in Europe in early 1900’s were seen as a toy for the very rich but Ferdinand has seen what Ford had done in America with the Ford model T and he had a strong belief that he can do the same for the people of Europe!
He took his idea and discussed it with many European companies to build a small affordable car for the masses but he was being led down again and again. Taking note from this, Ferdinand decided to just start his own company so that he was free to do as he pleased. Ferdinand noted that the cars of that day were throttled not aerodynamically enough. He wanted to built a car that is slick yet affordable well trying to financial backing for this new project Porsche was once again led down numerous times this was until 1933. In this year that a friend in this industry brought him to contact with a man named Adolf Hitler. He was the freshly elected Chancellor of Germany and later of the national socialist of German Workers Party otherwise known as Nazi Party.
For some contexts in the early 1930’s he says the man could lift Germany out of terrible economic situations and restores the strength demoralized population. Of course history tells us he turned out something quite different at the end. At this time he was looking to show how advanced Nazi most of the world. One way of showing this superiority was through engineering. He proposed that any German company that could build a race car for the upcoming grand precision would win 250,000 Reichmarks. Ferdinand Porsche and his engineering designs dominated the 1934 racing sessions and because of this he was contracted to make three prototype cars by the German Government. Impart these new cars were designed for sustained high speed on newly revived Autobahn Project. The outcome with this contract would be the Volkswagen Beetle.
Birth of the Beetle
Strangely the Beetle was originally going to be called the Kdf- Wagen. Kdf stands for Kraft Durch Freude (German for Strength through Joy). Kdf was the title of the leisure branch Nazi Party. This branch was in charge of making middle-class leisure activities affordable and available to the masses of the British Economic Slump of the 1920’s. This state-sponsored activity included concerts, plays, libraries, day trips and holidays. They also built large cruise ships and wanted to encourage tourism to Germany. The People’s Car was the small part of this vision. The Beetle wasn’t built for speed or beauty for top speed not far about 100 km now and the market was US $390 (25195 Rupees). It was built to just for one thing move people reliably and economically. The was created by the new firm created by the German Labor Front in 1937 Volkswagen.
The Kdf Wagen prototype car was on track for 3000 orders. But at that moment the world was about to be shocked by the biggest conflict in world history up to that day. In 1939, Hitler invaded Poland and World War II breakup. At the stage, only a handful of cars were complete and were ready to be delivered to customers. Germany went to full crisis mode and diverted all attention to war.
What the war eventually led to is that the main Volkswagen factory began manufacturing military vehicles including emphasis version of Beetle prototype. This manufacturing of military equipment meant that the factory was now a major bomb target. In 1945, when the war ended and peace enveloped the world like the most of Europe the VW factory land ruined, there was a un-detonated bomb found in the factory between the main power generators if it had exploded that would mark the end of Volkswagen. Meanwhile, Ferdinand Porsche was imprisoned in France for working for Hitler.
At 73 years of age, it was looking like Porsche’s dream of the small car for the masses may not come to reality. But he didn’t give up. Upon his release from prison, he spend countless hours on manufacturing flow listening towards what workers had to say and absorbing their ideas. At this time situations in Germany was meek people were starving and out of jobs. They needed a revival of the jobs for the middle class. Major Ivan Hirst of British Army took charge of the bombed VW factory and restarted production. Now finally the first Beetle began to roll off the production line. This first Beetle was made for the German postal service. Interestingly around this same, the Ford company was given the opportunity to have VW at a very meek price but they declined because they thought that the company was worth less. By 1948, Ferdinand was no longer directly involved in Beetle way on to work on another project. The Porsche 356 it was the car that began the Porsche legacy. In 1950, Ferdinand took one last tour to the factory and happy to finally see his vision being realized. He died one year later at the age of 75. The early success of the Beetle was limited only to Europe and the American market was more focused on buying more powerful cars and thought of Beetle to be underpowered. In order to take on this challenge, VW struck a deal where US car retailers had to buy three Beetle’s for every Jaguar car they imported as Jags were very much demand at that time. With time, the Beetle became even more popular than Jaguar in the USA!
Volkswagen’s rise to the Global Platform
As the river of production increased the Beetle began gaining worldwide recognition for its reliability due a high standard engineering and quality control. By 1955, Volkswagen had produced close to a million Beetles. The late 1950’s and early 1960’s show the peak of Beetle popularity. Customers had to wait for 12 to 18 months for receiving their order and the Beetle even became an icon of the Counterculture Revolution in 1960’s in America.
The success of the Beetle allowed VW to acquire Audi in 1965. Always looking for Volkswagen for this time but the Beetle fever wouldn’t last forever and sells began to decline in 1973. As a reaction to this VW came with all new generation of cars. Passat, Golf and Polo were the new cars. In 1980’s, they acquire 70% stake in Spanish car manufacturer Seat. In 1998, VW bought Bentley, Lamborghini and Bugatti. Two years later they also take Škoda on board. In 2010, VW acquired Italian automotive design house Italdesign Giugiaro. This was a pretty big deal as Italdesign is credited with aesthetic creations of a wide variety of cars for various companies including BMW, Aston Martin, Chevrolet, Fiat, Ford, Ferrari, Hyundai, Mitsubishi and several others. Their designs always stood classically futuristic famous of them is DeLorean DMC-12 in 1981. In 2012 VW’s subsidiary Audi purchased Italian motorbike maker Ducati.
Today, VW has turned into one of the most valuable companies in the world. It is ranked 6th in the 2017 Fortune Global 500 list and was 7th in the 2016 list. It has the market cap of US $63.8 billion as of November 2016 and has maintained the largest market in Europe automotive market for last 2 years. VW is responsible for producing 13% of all passenger cars globally. This translates roughly to 19 cars every minute. It is the second largest number of any manufacturer on the planet behind Toyota. In addition to other car brands earlier VW also owns MAN trucks and Porsche. In total, they have approximately 340 subsidiaries. The company has 626,715 employees as of 2016. This is larger than Ford+GMC and Toyota. VW employees force is larger than the armed force of Australia, Italy, Croatia and Norway combined. The company has 120 production facilities in 20 European countries and further 11 in America, Asia and Africa. VW operates in total of 150 countries. They do more than just manufacturing cars though. Volkswagen Financial Services operates 51 countries and specialized in loans, investments, and insurance for both business and private enterprises.
Volkswagen in India
Volkswagen entered the Indian market in 2001 with the launch of the SKODA brand. Audi and Volkswagen entered in 2007, while Lamborghini and Porsche were introduced in 2012. Today, VW has plants in Pune and Aurangabad and is operating major brands like SKODA, Volkswagen, Audi, Ducati, Porsche and Lamborghini in India. Volkswagen Group India has about 5,000 employees working at its various locations in India. Over 3,500 employees work at the Pune plant with about 1,000 employees dedicated to the Aurangabad plant and around 300 people employed at the National Group Sales Office in Mumbai.
The Infamous Diesel Gate Instance
On 18th September 2015 VW was found cheating on emission tests, where software code that detected one of emission for being conducted was manipulated for better results. Affected cars emissioned over 35-40 times the legal levels. This incident led the drop of market value of Volkswagen by close to US $30 billion. The defect was traced to 11 million vehicles worldwide, which included eight million in Europe. The cars affected most under the diesel gate were the Audi A3, Volkswagen Jetta, Beetle, Golf and Passat. In addition to this, vehicles with the 3-litre TDI engine were also affected across brands such as Porsche and Audi. It was a tough period for the VW group but the company has recovered well from this drop back.
Some more facts about VW
- Volkswagen names some of his cars after wind current across the world. For example, Polo is named after the Northern Polo Wind, Passat is named after a German Trade Wind, Jetta is named after the jet stream in subtropical to middle altitudes.
- Three Volkswagen cars were in the name of top ten best selling cars of all time the Volkswagen Golf, Beetle and Passat.
- An entire town was built to accommodate the workers of the first VW cars. It would become Wolfsburg, the fifth largest city of German State of Lower Saxony. The local football team is owned by VW and is ranked 38th just behind Liverpool. The Wolfsburg VW plant is still the largest car factory under a single roof in the world.
- In 1932, Stalin invited Ferdinand Porsche to the Soviet Union. Stalin wanted to advance the industrial development in the Soviet Union with the help of experts from different countries. They offer Ferdinand position of General Director of development for the Soviet Water Industry. According to Porsche’s son after much consideration Porsche refused the reason not that the fact that was the Soviet Union but also a language barrier. It Porsche accepted then the Beetle could be the symbol of Soviet Union.
*All of the information in this article has been collated from various online and offline sources and may not be factually perfect.