Globalisation

Responsibly exploiting the growth potential that globalisation offers is one of the biggest challenges facing internationally-oriented companies. To remain internationally competitive, they must access new markets and continuously improve productivity at all their sites. The European automotive industry is competing with Asian and US manufacturers. While the European and US vehicle markets are close to saturation, the main opportunities for the auto industry in future will be in emerging markets, and in particular the BRIC countries – Brazil, Russia, India and China. To access these markets, companies must have their own local production plants and produce vehicles that are specifically adapted to local requirements at local costs.

Global minimum standards
The conditions under which international companies operate in the emerging and developing markets are subject to close public scrutiny. That is because, generally speaking, environmental and social standards – and costs – are substantially lower in these countries than in the industrialised countries. For the Volkswagen Group therefore, it has always been clear that when globalising our business operations, we must apply social and environmental minimum standards across the Group. A common set of environmental, health and safety principles has therefore been laid down for all plants. And the Volkswagen Social Charter, which is based on the International Labour Organization (ILO) standards, also applies to all the Group’s plants.

Accordingly, the Volkswagen Group also accepts co-responsibility for its entire supply chain. In 2006, the Group implemented a partnership model that commits its suppliers worldwide to enforcing certain minimum ecological and social standards.

The aim is to help ensure sustainable development in all our global operations while at the same time safeguarding our innovative capabilities and competitiveness.

International presence
The Volkswagen Group was quicker than most to realise the advantages of an international strategic orientation. More than 50 years ago, long before the current globalisation debate began, we opened our first branch in South America. And in 1959 the first Volkswagen production plant outside Germany was inaugurated in São Paulo, Brazil. Today, South America accounts for 12 percent of our total world production, while Asia, which also represents a key market, accounts for a further 12 percent.

Boosting productivity
As a company whose roots are traditionally in the European market, the Volkswagen Group feels a particular commitment towards its European plants. To this day, almost 70 percent of Volkswagen’s products are built in Europe.

On account of the rising pressure on costs in recent years, a wide-ranging restructuring programme proved necessary in Germany and across Europe. Corporate processes are being improved, productivity increased and synergies exploited.

Thanks largely to the ForMotion programme and its successor, ForMotion Plus (introduced at the beginning of 2006) the Volkswagen Group can today point to substantial successes in terms of process optimisation and cost cutting.