Motoring the Future: VW and Toyota Vying for Pole Position

286 Pages·2012·1.917 MB·English

by  Engelbert Wimmer (auth.)

MOTORING THE FUTURE

MOTORING THE
FUTURE
VW and Toyota Vying for
Pole Position
Engelbert Wimmer
With contributions by Arun Mani
PA Consulting Group responsible for the
content and owner of the IP
© PA Consulting Group 2012
Translated by Brian Melican
Softcover reprint of the hardcover 1st edition 2012 978-0-230-29955-9
All rights reserved. No reproduction, copy or transmission of this
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accordance with the Copyright, Designs and Patents Act 1988.
First published 2012 by
PALGRAVE MACMILLAN
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registered in England, company number 785998, of Houndmills, Basingstoke,
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Palgrave® and Macmillan® are registered trademarks in the United States,
the United Kingdom, Europe and other countries.
ISBN 978-1-349-33524-4 ISBN 978-0-230-30781-0 (eBook)
DOI 10.1057/9780230307810
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10 9 8 7 6 5 4 3 2 1
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CONTENTS
List of Figures and Tables vii
Acknowledgments ix
Preface xi
About the Author xiii
1 The Car Industry Today: Staging a Stellar Comeback 1
2 Volkswagen: The Surprise Challenger 26
2.1 Shaping a Global Automotive Empire 27
2.2 Strategy for Reaching the Top 33
2.3 Showdown in the USA 41
2.4 Powerful Competitors 46
2.5 China’s State-Controlled Economic Boom 47
2.6 Expansion in Emerging Economies 65
2.7 VW Pushes Sales 66
2.8 Prefab Variety 68
2.9 Growing without Getting Bigger 72
2.10 Intelligent Brand Strategies 75
2.11 Process Is the Problem 78
2.12 Going the “Volkswagen Way” 81
2.13 Small Costs Big 84
2.14 Luxury Becomes Obligatory 89
2.15 The Search for the Right VW Engine 90
2.16 The Price of Politics 104
2.17 Piëch, Then Winterkorn – and Who Next? 113
3 Toyota: An Auto Giant Overcoming a Gigantic Crisis 120
3.1 The “Toyota Shock” 123
3.2 A New Beginning 131
3.3 The Power of Tradition: How a Japanese Loom
Builder Became an Automotive Giant 134
v
vi CONTENTS
3.4 The Legend and the Reality Behind It: The Toyota
Production System 140
3.5 A Global Player with a Distinctly Japanese Identity 152
3.6 Toyota’s Luxury Strategy: Lexus vs. Daimler and BMW 158
3.7 Motorizing Emerging Economies: Toyota’s “Car for the World” 162
3.8 Managing Relationships the Japanese Way 165
3.9 Toyota: An Endurance Runner 172
3.10 The Disaster: “Runaway Toyotas” 177
3.11 Change of Generations: Exploring Future Possibilities
and Carrying the Load of the Past 190
3.12 Environmental Protection: Toyota’s Development
of Alternative Drivetrains 193
4 The Race for Pole Position: Winning by a Nose 210
4.1 Phoenix from the Ashes 210
4.2 Round Two 212
4.3 Volkswagen Moves to Overtake 214
4.4 Toyota: Digging in on the Green Front 217
4.5 The Battle on the Bottom Line 218
4.6 The Tides of Globalization 222
4.7 The Final Lap 225
4.8 Comparing Corporate Values 226
5 Epilogue: New Challenges and New Engines 228
5.1 Population Growth and Oil Supplies 228
5.2 Biofuels: Green Gasoline 231
5.3 A Tank Full of Gas 236
5.4 Hoping for Hydrogen 236
5.5 Electric Cars: The Day after Tomorrow 237
Notes 255
References 260
Index 265
LIST OF FIGURES AND TABLES
FIGURES
1.1 Global sales forecast until 2015 by region 14
1.2 Car segments transforming 20
2.1 Sales forecast for China through 2015 50
2.2 T ransition from conventional platforms
to modular toolkits 69
2.3 Estimates of average carbon emissions of fleets from
various European and American manufacturers 91
2.4 T otal cost of ownership scenarios for conventional, hybrid,
and electric vehicles in USA and Europe 93
2.5 Calculating the costs of lowering CO
2
emissions through 2015 98
3.1 The Toyota concern: a network of companies 166
3.2 Supply management: Japanese versus
European/US model 169
3.3 Sales forecast for the USA until 2015 177
3.4 J .D. Power and Associates – 2011 vehicle dependability
study, US market 189
4.1 The appendix of corporate values 227
5.1 Global population growth 229
5.2 Worldwide oil consumption 230
5.3 Oil price curve based on yearly averages 231
5.4 Alternative fuels: an overview 232
5.5 Technology hype cycle 241
5.6 Fuel usage distribution in an average vehicle – where does
the gas go? 243
5.7 Changes in battery costs per kwh 244
5.8 Global sales forecasts for plug-in-hybrid and
electric vehicles 252
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viii LIST OF FIGURES AND TABLES
TABLES
1.1 Comparison of 2010 sales and revenue 13
1.2 Analysis of segment development 21
2.1 Brands and acquisitions of Volkswagen AG 40
2.2 Car sales of the ten largest OEMs in China,
January–July 2009 compared to January–July 2010 53
3.1 Major shareholders 173
ACKNOWLEDGMENTS
The work at hand represents an extended and thoroughly revised edition of
Antrieb für die Zukunft, its German-language predecessor. In updating this
book for translation, I have incorporated new facts and material, extending
the scope to the American manufacturers, who have staged a stellar come-
back in 2010 and 2011. I also took a closer look at new competitors from the
Far East, especially the up-and-coming Korean Hyundai/Kia group, inasmuch
as they too have taken up the challenge of racing to the top in terms of vol-
ume growth and next-generation vehicles.
Antrieb für die Zukunft was written with two co-authors: Petra Blum and
Mark Christian Schneider. This new edition would not have been possible
without their profound input for the German book, which was published in
2010.
Furthermore, I remain very grateful to the two companies so closely por-
trayed in this book. Both Volkswagen and Toyota were very supportive of
the project, and I would like to express my deep gratitude to the managers
at both companies for the many insightful conversations we shared on the
topic.
I would also like to mention Arun Mani, an energy expert and member
of the PA Consulting Group management team. Arun made a decisive con-
tribution to the last chapter with his views on the interplay of the energy
sector and the car industry (section on “Utilities and the adoption of electric
vehicles” in Chapter 5). I am greatly indebted to him for his help in showing
where the frontiers will lie in the future of automotive mobility.
In fact, there was a whole team of people at PA Consulting who worked
on this book, and I would like to extend my thanks to Karsten Gross from
Marketing, consultants Felix Salditt and Michael Tickle, and Thorsten
Brückner from the PA Knowledge Processing Centre.
Deserving of a very special thank you is the ever-accurate Hanns Peter
Becker, a consultant and engine specialist who was indispensible in making
our mathematical models work. I would also like to thank Brian Melican,
ix