Carmakers look to cut down variants for new automotive landscape

1 May 2018

Both Volkswagen (VW) and BMW are looking to reduce their model versions as the manufacturers seek to move finances around in the wake of WLTP and the need for the development of new technologies.

At VW, from August this year, a total of 36 model versions of the Up! city car, the Tiguan SUV and the Arteon coupe will be removed from sale, while BMW will take 20 models with manual transmission out of its range.

With the diesel market collapsing, manufacturers are looking to fast-track development of electric vehicles, while also working on autonomous technology which has been building over a number of years. Meanwhile, in order to combat the introduction of the new Worldwide Harmonised Light-Vehicle Test Procedure (WLTP), carmakers need to reduce the financial burden of testing every model of vehicle they produce, together with the number of options available.

Speaking to Automobilwoche, VW Group Chief Financial Officer Frank Witter said: ′Optimizing the transmission-engine variants is always a good idea, regardless of WLTP or increasing electrification. We should always align ourselves with the interests of our customers and offer them where there is a good demand. That’s what counts.’

Meanwhile, BMW CFO Nicolas Peter told the publication: ′We have to take the complexity out of the production and the offer and evaporate the effort of the countless variants. If you go to a BMW dealer, today he can offer you ten engine variants of the BMW threesome. We will not need that in the future.’

BMW is currently examining which equipment is not in demand from customers, such as steering wheel variants or colours. ′The high cost is driving costs. In the end, up to 80% of the variants that are least in demand will be eliminated. And why is this happening to us right now? Because the cost pressure increases due to higher costs in electromobility. We have to compensate for that,’ emphasised Peter.

BMW is planning to launch at least 12 EV models by 2025, and therefore needs to ensure it can finance such a plan. The company is aiming to reduce its costs for transmission components and other parts in order to cut €2 billion from its spending and move it to EV research.

BMW will drop manual gearshift variants of the BMW 2 Series Coupe in the United States to cut down the cost of certifying components in each market, and it has dropped manual shift options from entry-level versions of the new 5-Series diesel.

Volkswagen Group (VW) has already suggested that WLTP may cause bottlenecks in production as it seeks to get vehicles through the procedure. VW finance chief Arno Antlitz suggested the automaker faced “heavy financial demands” due to bottlenecks expected from introducing WLTP tests.