Volkswagen CEO: Reformneeds need edgy to avoid becoming another Nokia

The chief executive of German carmaker Volkswagen says the company needs to speed up business reforms to avoid becoming another Nokia. Nokia, the veteran handset maker, gave up its dominance of the handset market to Apple many years ago. The multi-brand carmaker hopes to increase its market value to 200 billion euros ($223.1 billion) from its current level of about 91 billion euros ($223.1 billion) by restructuring assets, cutting costs and expanding into new technologies such as connected cars.

Volkswagen CEO: Reformneeds need edgy to avoid becoming another Nokia

Automakers are accelerating research and development spending to catch up with technology rivals competing to build self-driving cars as regulators tighten emissions rules, force carmakers to clean up internal combustion engines and develop zero-emission selectric vehicles.

“The big question is: Are we fast enough? “It will be very difficult if we continue to grow at the current rate, ” Herbert Diess, Vw’s chief executive, told VW executives on Thursday. ”

He said VW is moving from a traditional automaker to a self-driving and connected automaker, a step that requires cost-cutting and efficiency gains. “The era of traditional carmakers is over,” Mr Dees added.

“All in all, this is probably the most difficult challenge for Volkswagen,” Dees said. He said Volkswagen plans to comply with stricter emissions targets while seeking to maintain profit margins. ‘Volkswagen needs to focus more on profits than on sales, ‘ Mr. Dees said.

In order to make the transition, VW must focus on its strengths and give up on anything that hinders performance, says Mr Dees.