Volkswagen's Zwickau plant in Germany / Courtesy of Volkswagen Group

By Kim Hyun-bin

Zwickau, Germany ― The Volkswagen Group is in the process of conducting a major restructuring by transitioning from a traditional car manufacturing hardware business to become a global leading software mobility corporation through its "New Auto" initiatives.

The New Auto strategy focuses on four major segments ― mechatronics, software, mobility and battery and charging ― which are Volkswagen Group's keys to transitioning into the electric vehicle (EV) market with full force.

To give a closer look, Volkswagen Group Korea invited local journalists to Germany to show the progress that has been made less than a year after announcing the New Auto initiative by visiting key factories and software companies under its wing.

The Volkswagen Group has 10 brands in seven countries including Volkswagen, Volkswagen Commercial Vehicles, Skoda, Cupra and SEAT as well as premium brands such as Audi, Lamborghini, Bentley, Ducati and Porsche.

Volkswagen employees work on the assembly line for EV models at the company's Zwickau plant in Germany, May 20. Korea Times photo by Kim Hyun-bin

Start of electrification

Volkswagen's Modular Electric Drive Toolkit (MEB), a modular EV platform, is taking another step toward becoming the industry standard for e-mobility.

"The Volkswagen Group focused on two main axes in pursuing platform innovation. Volkswagen focused on expanding its volume segment and aimed to provide a special mobility experience for customers," said Andreas Walingen, chief strategy officer at the Volkswagen Passenger Cars brand. "On the other hand, Audi and Porsche have developed platforms around premium performance experiences (PPE). Since each brand has different characteristics, we decided that pursuing two platform strategies, MEB and PPE, would be effective in achieving the Volkswagen Group's aggressive electrification goal."

The company set aside 52 billion euros to invest in electrification alone from 2022 to 2026 in efforts to introduce 50 new EV models by 2030 and bring up the EV lineup to over 50 percent of the company's vehicles.

Ford Motor Company plans to produce EV models for the European market based on the MEB platform. The U.S. carmaker will also double its planned MEB volume to 1.2 million vehicles over a six-year timeframe. Designed as an open vehicle platform, the MEB allows car manufacturers to electrify their portfolio quickly and cost-effectively, the company said.

The MEB offers a high level of competitiveness while providing considerable freedom in design and model development. It covers a wide range of segments and vehicle types, from compact vehicles up to SUVs and vans. The most recent model based on the MEB is the Volkswagen ID. Buzz.

Reporters representing local media and The Korea Times visited the Volkswagen Zwickau plant, which is a representative factory that produces models based on the MEB and is the first example of an internal combustion engine plant converted to 100 percent EV production. It aims to produce 3.3 million cars a year for six MEB-based models.

Volkswagen ID.3 and ID.4 models started production in August 2020, and Audi Q4 e-tron models started production in March 2021. Since January of this year, the Volkswagen ID.5 is also being produced.

A Volkswagen ID.4 vehicle is in production at the company's Zwickau plant in Germany, May 20. The ID.4 is expected to be launched in Korea in the second half of this year. Korea Times photo by Kim Hyun-bin

The plant aims to increase daily production to 2,400 from the current 900.

"Currently, we are running two shifts only capable of producing 900 vehicles per day due to COVID-19 and other global uncertainties," a Volkswagen Zwickau plant official said. "But we plan to run three shifts and produce 1,400 vehicles per day by the end of the year and also planning a ramp-up that will increase production to 2,400 per day."

As of 2021, about 180,000 vehicles have been produced, and over 6 million vehicles have been produced since the establishment of the plant in 1990. It is the first plant to be converted from an internal combustion engine production plant to a 100 percent EV production plant, with an investment of about 1.2 billion euros.

"Currently out of the 120 factories under the Volkswagen Group, we are in the process of transitioning 10 plants to BEV," a Volkswagen Zwickau plant official said. "We plan to continue our electrification process for other plants in the near future."