1965 Volkswagen Beetle on 2040-cars

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New safety and connected features help distinguish VW's lineup

Volkswagen may have wrested the title of world's largest carmaker away from Toyota this week, but the company still has some work to do in the United States. Despite its worldwide dominance, Volkswagen's American sales have languished. Unlike its red-hot Audi brand, mainstream Volkswagen sales have been afflicted by an assortment of maladies. An aging lineup, a reputation for mechanical gremlins and a lack of a competitive crossover vehicle have all hurt. In the US, the brand's cars claim only two percent of the overall market. As we reported earlier today, Volkswagen took steps this week to upgrade some broader aspects of its weaknesses here. At its Electronics Research Laboratory in Silicon Valley, the company announced it would make several advanced safety features and connectivity options available throughout the bulk of its lineup. Features that have long been available on its premium Audi cars will spread to its more economical offerings. In one big way, they will overstep their premium siblings. Volkswagen said Apple CarPlay, Android Auto (pictured below) and MirrorLink will all be available on a revamped infotainment system. Cars equipped with the new Car-Net-branded systems are arriving in showrooms now. Only last month, Hyundai became the first to offer CarPlay, debuting the smartphone-projection system in its 2015 Sonata. Chevy, Honda, and now Volkswagen, have quickly followed suit. On the safety-minded side, features like adaptive cruise control, forward collision warning, autonomous emergency braking, park steering assist and automatic post-collision braking will be optional equipment on most of the brand's 2016 model-year cars. Previously, the features had only been available on the Touareg SUV. They're now available on most Golf variants, the CC, Jetta, Sportwagen and some Beetles. Though the Passat sedan is one of the company's most competitive cars, it was curiously absent from the announcements, though an update could come later this year. While the advanced safety equipment is a boon for motorists increasingly interested in the technology, Volkswagen also added some basic safety tech that's long been available in mainstream competitors' cars, adding features like blind-spot monitoring and lane-departure warning. One of the big differences consumers might note is the cost of the driver-assistance systems.

Volkswagen feuds with thriving stablemate Skoda

BERLIN, Oct 4 (Reuters) - Volkswagen managers and unions are seeking to curb competition from lower-cost stablemate Skoda, move some of its production to Germany and make the Czech brand pay more for shared technology, company sources told Reuters. As VW struggles to cut jobs and spending at German factories and turn the page on dieselgate, Skoda's superior car reviews and profitability have intensified the brands' rivalry within the Volkswagen empire. VW now wants to reduce what it sees as Skoda's unfair advantages - combining German technology with cheaper labor - and reaffirm the top-selling brand's primacy ahead of a wave of new electric car launches, the sources said. The tussle between VW and Skoda is reviving tensions at the heart of the Volkswagen group between profits and jobs, and between central control and autonomy for its 12 vehicle brands. "Instead of devoting our efforts to beating Tesla, we may just be setting up a futile internal conflict," said one manager. Once the butt of jokes, Skoda has blossomed under 26 years of VW group ownership into a successful mid-market carmaker, steadily winning business from rivals - including VW - and surpassing even Audi's operating profit margin last year. At the same time, VW is facing thousands of job cuts as management moves to trim excess capacity at German factories. Its powerful domestic unions see Skoda's success as both a threat and a potential lifeline. VW workers' representatives are now demanding the transfer of some Skoda production to their underused German plants, a source close to the supervisory board told Reuters. The proposal aims to offset declining output of the VW Passat and aging Golf that could otherwise threaten more jobs. They are also making the case that Skoda should pay higher royalties to use VW's main common vehicle platform. The so-called MQB architecture also underpins mid-sized models from the group's Audi and SEAT brands. Responding to the news, Czech Prime Minister Bohuslav Sobotka said he would meet Skoda management and unions to ask for clarification. The government will seek to ensure that VW investment plans are followed through and that "production is not moved outside the country," a statement released by Sobotka's office said. Skoda's main union warned that a production shift could cost as many as 2,000 jobs. VW's works council declined to comment.

VW sets aside $7.3B war chest for diesel scandal fallout

The crisis enveloping Volkswagen AG, the world's top-selling carmaker, escalated Tuesday as the company issued a profit warning following a stunning admission that some 11 million of its diesel vehicles worldwide were fitted with software at the center of a US emissions scandal. The German company said it was setting aside around 6.5 billion euros ($7.3 billion) to cover the fallout from the scandal that has tarnished VW's reputation, raised questions over the future of CEO Martin Winterkorn and battered its share price. The reputational damage to Volkswagen is implicit in the market's response. Volkswagen's share price slid a further 16.2 percent Tuesday to a near four-year low of 112 euros. The fall comes on top of Monday's 17 percent decline. The shockwaves from the scandal enveloping Volkswagen were being felt far and wide across the sector as traders wondered who else may get embroiled. Germany's Daimler AG, the maker of Mercedes-Benz cars, was down 6.5 percent, while BMW AG fell 5.4 percent. France's Renault SA was seven percent lower. The scandal is hugely damaging to a business that relies heavily on a hard-won reputation for quality and trustworthiness. "Brands are all about trust and it takes years and years to develop. But in the space of 24 hours, Volkswagen has gone from one people could trust to one people don't know what to think of," said Nigel Currie, an independent UK-based sponsorship and branding consultant. The trigger to the company's market woes was last Friday's revelation from the US's Environmental Protection Agency that VW rigged nearly half a million cars to defeat US smog tests. The company then admitted that it intentionally installed software programmed to switch engines to a cleaner mode during official emissions testing. The software then switches off again, enabling cars to drive more powerfully on the road while emitting as much as 40 times the legal pollution limit. "We have totally screwed up." - Michael Horn "In my German words: we have totally screwed up," the head of Volkswagen's US division, Michael Horn, told an audience in New York on Monday. In its statement Tuesday, Volkswagen gave more details, admitting that there were "discrepancies" related to vehicles with Type EA 189 engines and involving some 11 million vehicles worldwide. The number of vehicles involved is more than the 10 million or so cars it sold in 2014.