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Coronavirus prompts VW to stop production throughout Europe

FRANKFURT — Volkswagen Group, the world's biggest carmaker, is suspending production at factories across Europe as the coronavirus pandemic hits sales and disrupts supply chains, the company said on Tuesday. The German carmaker, which owns the Audi, Bentley, Bugatti, Ducati, Lamborghini, Porsche, Seat and Skoda brands, also said that uncertainty about the fallout from coronavirus meant it was impossible to give forecasts for its performance this year. "Given the present significant deterioration in the sales situation and the heightened uncertainty regarding parts supplies to our plants, production is to be suspended in the near future at factories operated by group brands," Chief Executive Herbert Diess said on Tuesday. Volkswagen's powerful works council concluded it was not possible for workers to maintain a safe distance from each other to prevent contagion and recommended a suspension of production at its factories from Friday. Production will be halted at VW's Spanish plants, in Setubal in Portugal, Bratislava in Slovakia and at the Lamborghini and Ducati plants in Italy before the end of this week, Diess said. Most of its other German and European factories will prepare to suspend production, probably for two to three weeks, while Audi said separately it would halt output at its plants in Belgium, Germany, Hungary and Mexico. Volkswagen's vast factories in Chattanooga, Tennessee, in Puebla, Mexico, and plants in Brazil were not affected, but that would depend on how the coronavirus spreads, VW said. Volkswagen has 124 production sites worldwide of which 72 are in Europe, with 28 in Germany alone. "2020 will be a very difficult year. The coronavirus pandemic presents us with unknown operational and financial challenges. At the same time, there are concerns about sustained economic impacts," Diess said.   Production in China resumes Volkswagen Group sold 10.96 million vehicles last year, putting it ahead of Toyota based on the latest figures from the Japanese carmaker. Globally, VW employs 671,000 people and it delivered 4.86 million vehicles to European customers in 2019. Only last month the car and truck maker based in Wolfsburg, Germany, predicted that vehicle deliveries this year would match 2019 sales and forecast an operating return on sales in the range of 6.5% to 7.5%. "The spread of coronavirus is currently impacting the global economy. It is uncertain how severely or for how long this will also affect the Volkswagen Group.

German prosecutors investigating Audi for emissions scandal

After weeks of investigation into Volkswagen by prosecutors in Braunschweig, Germany, attorneys in Ingolstadt will also begin an examination into Audi's potential role in the emissions scandal. They reportedly received multiple criminal complaints that requested an inquiry, including one from Audi, according to Bloomberg. The prosecutors in Ingolstadt want to focus on people within the automaker that are responsible for emissions. However, the investigation is still too early in the process to identify any specific suspects. The German lawyers might also eventually combine their cases, but they remain separate for now. "Braunschweig took those parts that are clearly located at Volkswagen and asked us to keep the elements limited to Audi," a spokesperson for the Ingolstadt attorneys told Bloomberg. Audi has 2.1 million vehicles worldwide with Volkswagen Group's emissions-cheating four-cylinder diesel, including an estimated 13,000-14,000 of them in the US. The Environmental Protection Agency also recently filed a second violation notice against the 3.0-liter TDI V6 that was used in several of the company's models here, and the automaker responded with a stop sale for them. VW Group's carbon-dioxide emissions cheating in Europe also reportedly involves some Audi models. In that case, engineers admitted to artificially improving test results to achieve the cuts that the automaker requested.

How Audi keeps it fresh in the design department

Audi was, even very recently, seen as a near-luxury brand, on par with niche if specific European automakers like Saab and Volvo. But early in the 21 st century, the four-ringed circus from Ingolstadt found a way to elevate itself to the level of its aspirational German rivals at Mercedes and BMW. While these brands were immersed in what we like to refer to as their Baroquecoco Period – a moment in which the exteriors of their cars gained bulges and, ahem, bangles, and their interiors failed to keep pace with the march of technology – Audi kept it simple. Its designs avoided the imperious Faberge gilding of Benz, or the Ghery-esque swoop and swoon of Bimmer. Instead, they were clean inside and out, with simple and elegant lines, comprehensible ergonomics, and subtle new signatures that were recognizable without being in any way overwrought. Customers, alienated by their rivals, flocked. Sales rocketed. And Audi became known as a formal/functional design leader – the Mid-Century Modern Architecture of the luxury vehicle world. But now BMW and Mercedes have taken note and corrected course. Both brands have discarded their dalliance with carbuncularity and are now, debatably, near the top of their game design-wise. Benz is delivering handsome stolidity not seen since the Bruno Sacco era of the Seventies and Eighties, and BMW has regained a grip on the kind of elegant sportiness characterized by Paul Bracq during the same time period. And the interiors of both brands are consistently on a level of craftsmanship, attention to detail, delight, and material selection and innovation once reserved for Bentley and Rolls. View 17 Photos This puts Audi in something of a design double-bind. First, its transaction price has escalated to the point where it lives in the same set as BMW and Mercedes. But now that those brands have caught up with (or perhaps even surpassed) the crisp Auto Union sensibility, how does it differentiate itself? "You have to have a clear design theme," says Frank Lamberty, Audi's exterior design director. "We define this as Quattro, because this is unique for Audi, this is our tradition. And Quattro means we have all the wheels powered, so we want to show that in our design. And this is different from a rear-wheel-drive car. We are coming from a front-wheel-drive platform, so everything is more balanced. Everything is in the middle, rather than leaned back. That is a clear proportion thing.