Automotive

Published on November 17th, 2020 | by Subhash Nair

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Volkswagen AG Might Lose Italian and French Brands Soon

It looks like one of the largest carmakers in the world, Volkswagen Group, might have to lose a couple of high-pollutin’ brands in order to hit its CO2 emissions targets. According to Automotive News, the company hasn’t made any decisions yet, but are considering some options for their Italian brands, including spinning them off or an initial public offering. The brands in question are the supercar brand Lamborghini, the superbike brand Ducati and the design studio Italdesign.

While these brands were not directly blamed, Volkswagen will be missing its CO2 target this year by a gram or more. In the coming years, the company will be investing very heavily in electrification. The combined total investment in digital and electrified technologies in the next 5 years for the company is estimated to be in the range of 73 billion euros.

CEO, Herbert Diess

“We are working on our Italian legal structure,” CEO Herbert Diess said. This story is still developing and as of yet, no formal announcements have been made. Lamborghini is still on track to reveal its latest model, the Huracan STO, some time this week. In the company will continue to make profits with its environmentally-unfriendly Urus SUV.

Besides the Italian brands, we also know Volkwagen Group’s French brand, Bugatti might also see new ownership as part of their deal with Rimac. Here’s more on THAT deal:

It seems that Rimac management have signed a deal with Bugatti’s parent company Volkswagen Audi Group to completely take over the Molsheim-based hypercar manufacturer. 

Volkswagen’s rationale for divesting in the firm that produced the Veyron and Chiron is to free up resources that can be used for development of future technology like electrification and autonomous driving. In the eyes of the VAG group, selling these so-called hobby brands like Bugatti will free up much needed capital that could be better used in other departments.

Looking at this deal with the future in mind, it is probably right for Rimac to take over Bugatti. As much as petrolheads would not want to see it, it is an almost certain fact that if the next Bugatti will want to continue smashing records and be allowed on the road in a world with increasingly tight emissions regulations, electrification is the only way to do. And with Rimac’s expertise in electric drivetrain and power supply development, this acquisition seems like the right path for both boutique hypercar manufacturers. 

In addition to that, if the deal is as alleged, Porsche (and in extension the wider VAG empire) having more access to Rimac through the increased stake will surely benefit the conglomerates electrification development efforts. 

Thus far, there has been no official word yet on when this deal will be finalised from either party. Rest assured though that when this deal does go through, it will have massive implications on the whole auto industry. Watch this space. 

Bugatti, which sold 82 vehicles last year, has long been viewed as a prime example of VW’s engineering extravagance. In 1998, it was revived under former Chairman Ferdinand Piech after the brand had largely faded from existence in the 1950s. Because of high development costs and low volumes, the 16-cylinder Veyron — Bugatti’s first model under VW control — was considered one of the biggest money losers in the auto industry. VW doesn’t break out financials for the brand.

Bugatti has recently pursued efforts to potentially survive outside the German auto group and head off the risk of being phased out once again. Since the 2015 diesel-cheating scandal, VW has been taking a closer look at its portfolio, with a particular focus on the expensive luxury-car brands amid the growing burden of investing in electric mobility and self-driving technology.

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Written work on dsf.my. @subhashtag on instagram. Autophiles Malaysia on Youtube.



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