The woes of the Volkswagen Group are so well known and oft discussed in The Morning Dump that it’s almost not worth repeating them. One version is that the company’s hubris is to blame for all its troubles. This tendency to assume the company could do everything if it just threw enough engineers at a problem allowed it to underestimate Toyota and hybrids which led to Dieselgate and, in the fallout of that, led it to believe it could quickly catch Tesla as an EV automaker while completely missing the threat from China. Another version is that Volkswagen expanded at exactly the wrong time, buying too many brands and it got caught flat-footed.
Of course, nothing with Volkswagen is ever simple, and CEO Oliver Blume’s proposed plan to nix approximately 50% of all models and 75% of all variants from the Volkswagen Group lineup and cut back on production faces a lot of internal resistance. Someone who doesn’t have to care so much about what his own board of directors thinks is Tesla CEO Elon Musk, whose company just went the opposite direction and introduced a new Model Y variant.
BMW continues to be the strongest luxury brand in the United States and, in fact, BMW’s sales in the Americas now outweigh the company’s sales in China, which is a sign of how much the rise of the Chinese car industry has stymied German automakers.
Volkswagen’s Dangerous Game
My neck is still recovering from whiplash this morning. Yesterday, the story was the success of the Porsche 911, due in no small part to how many variants the brand offers. Today, Volkswagen Group CEO Oliver Blume and CFO Arno Antlitz are announcing that the way forward is a reduction of models by 50% and variants by 75%.
Here’s Blume, via Handelsblatt, explaining the why, if not specifically the how:
Blume said on Friday that the board was “continuing to drive the transformation” and was “taking responsibility for the sustainable future of the company with the most comprehensive realignment in the company’s history – at a time when the automotive industry is under great pressure worldwide.”
With his vision for the future, Blume aims to position the company more robustly and competitively, even in a massively challenging global environment. “We are limiting risks, unlocking new opportunities through our own strength, and sending a clear signal for a new beginning in Germany as a business location.”
This change is necessary as Volkswagen’s brands continue to suffer in China (VW’s brands were down 37% there in Q2 of this year), and as the company’s over-commitment to the EV head-fake and failure to develop its own software have eroded its income and margins. All of that, combined with a suddenly protectionist trade policy in the United States, have made it necessary for the company to consider dramatic steps. No one with any sense believes that Blume should just stay the course and hope it all works out in the end.
Is simplification of the lineup the way forward? I’m less sure.
Nothing I’ve seen explains in any detail which models are getting cut, where they’re getting cut, or what kind of variants are going out the window. It’s possible that Volkswagen Group hasn’t even finalized what that looks like. There’s some logic here and, until I see the full plan, I cannot fully dismiss it. My initial instinct is that it’s highly unlikely that anyone at Porsche would allow the company to cut variants of, say, the 911, which typically provides a lot of cash for the brand. Bentley, too, relies on variants to generate a rich margin. Lamborghini is probably also safe, although it’ll continue to be necessary for all of those brands to share platforms going forward.
It may seen a bit odd to Americans to consider that the biggest culprit here is probably Volkswagen’s namesake brand, mostly because Americans have a paucity of models to choose from. The rest of the globe gets many, many Volkswagen models. Does the company need the Taigo, the T-Cross, the T-Roc, the T-Roc Cabriolet (coming to Pebble Beach via The Autopian in 2045), the Tayran, the Tayman, and the ID.7 Tourer?
Okay, I made up one of those, but you probably don’t know which one. Simplifying this lineup is completely sensible. Not only does VW sell the Taigo, it also sells five different variants of that in-betweener small crossover. Śkoda has been a brightspot for Volkswagen Group, and it gets by with far fewer models and fewer variants. The same can be said for SEAT (assuming you break Cupra out as its own brand).
Reducing all of these Malcolm Gladwell-esque variants likely means being able to streamline and reduce production, which is key for the company to save money. Even though most of these vehicles are built on a small number of VW Group platforms, dedicating production to lower volume models that aren’t high-margin, high-priced vehicles like a 911 is inherently inefficient.
Accepting the logic of streamlining, I don’t necessarily accept the logic of cutting 50% of all models across all brands and 75% of variants. That’s a lot of cars. While there are some signs that legacy OEMs can utilize existing joint ventures with Chinese automakers to get back some demand in China, the future of Volkswagen is probably outside China. People like choices and in North America, where VW damn sure needs to be competitive, the greatness of both Audi and VW came from having competitive vehicles with a high degree of optionality.
I remember when my best friend got his Mk 4 Golf. He’s not like me, so he went with a non-GTI automatic four-door in black, but nicely optioned with the incredible purpleish blue-und-red backlit gauges and buttons. He could have also had a diesel or, if he was like me, a two-door GTI. The appeal of Volkswagen was getting what you wanted, and the company’s attempts to de-content cars and oversimplify with models like the NMS Passat made the brand a lot less interesting.
Looking at the United States, both Volkswagen and Audi are suffering from a lack of truly competitive or interesting products. Not only do the cars need to get better (it sounds like the Tiguan Turbo is a big step in the right direction), but there need to be more choices. How that gets balanced with this push is unclear to me, and I fear that Volkswagen could make the mistake of reducing its lineup to a few models that are generally not compelling.
The Lotus line used to be: simplify and add lightness. For Volkswagen, I think the company needs to go back to the fun cars it used to build. Think of it as simplify and add brightness.
Blume’s ‘Large Package’ Likely To Come In Pieces
I will admit to thinking, on occasion, that I could maybe do a better job than some automotive CEOs. I’m almost certainly wrong and, in the case of Volkswagen, I would never make so foolish an assumption. The politics of Wolfsburg and the various families who own Volkswagen are too complex. I would do a terrible job.
Blume did great work at Porsche and stepped into a VW Group still reeling from Dieselgate and trying to catch up on electrification/software. While I’m sure Blume would have done a lot differently with hindsight, the logic he followed was the logic that pretty much every automotive CEO followed at the time.
Something has to be done and Blume has offered a dramatic plan. My question is whether or not Blume thinks he’s going to get everything at once, or is strategically making a huge ask so that he can, at the very least, get some of what he wants. This is the logic of my daughter asking for an afternoon of screentime so she can get an hour.
This is the question I have after reading this Handelsblatt column, translated as “Blume’s large package is now arriving in individual parts.”
Germany’s most powerful auto boss had originally intended to present his future plan for VW as a comprehensive package.to bring it through the supervisory board. That would have created clarity – for investors, employees and managers.
Instead, the board now has to fight for each package individually : the investments, the personnel issues, and then – presumably sometime next year – the reorganization of the corporate structure. What was meant to be a major breakthrough has turned into a drawn-out process . And investors and employees are asking themselves: What exactly is going on?
One might add, somewhat maliciously: It’s going exactly as one would expect from Volkswagen. The company’s management system was originally supposed to be revised by March 2025, although the initial agreement was for 2024. Now it’s July 2026.
Is all this tsuris a bug or a feature? Did Blume expect a rubber stamp, or is he asking for more than he needs so he gets what he wants? It’ll be fascinating to watch this all play out over the next few months.
Behold, The Tesla Model Y Longboi
While VW is cutting back variants, Tesla is adding them. Specifically, the long-wheelbase Tesla Model Y that first appeared in China is coming to North America. I think the longboi Model Y looks a little better proportioned than the stock Model Y, and I also think that the 2x2x2 seating with center captain’s chairs is an ideal layout for a vehicle like this. It’s also an improvement over the cramped three-row option in the current Model Y.
At the moment, the only reason to order one is because you’re a huge Tesla fan, because the company is doing its usual business of offering an expensive “LAUNCH EDITION” for the diehards. While the base Model Y RWD is still a great deal at $37,900, the $61,490 price for the longer Model Y puts it in league with vehicles like the larger Kia EV9.
I’m guessing the regular, RWD longboi will come in closer to the Kia and its Hyundai twin.
BMW Is Still The Luxury Leader In The United States
I don’t know how I feel about the BMW iX5 yet. I guess I’ll have to see it in person. Of all the German automakers, I’ve long had the sense that BMW has the best plan and is producing the best products. If you look at the last generation of true EVs from the Germans it’s clear that, aesthetics aside, the BMW iX is far better than either the Mercedes EQ variants of the Volkswagen ID. I may prefer the Taycan, but as a mass-market car the iX was probably a better fit for most.
While BMW has all the same maladies in China as everyone else, it’s kicking butt here in the United States.
BMW deliveries rose 13 percent to 102,713 in the second quarter with robust results by the 3 Series compact sedan, X3 compact crossover and X5 midsize crossover.
BMW sold 186,944 vehicles in the first half of 2026, up 4.7 percent.
Lexus was a distant second with sales of 88,760, a decline of 7.5 percent. Lexus’ U.S. deliveries totaled 169,712 for the first half, a decline of 5.2 percent. The drop in quarterly sales largely reflected the impact from one vehicle: the ES sedan, which has undergone a redesign and is just beginning to arrive at dealerships.
Mercedes-Benz remained in third place with retail sales of an estimated 75,000 passenger vehicles in the quarter. Mercedes has sold an estimated 145,000 passenger vehicles in the first half, down 3.5 percent.
Lexus could always catch up and, by next year, it might on the strength of the new ES. In the meantime, BMW is in a decent position and is, for the first time in a decade, selling more cars in the Americas than in China.
What I’m Listening To While Writing TMD
Sienna Spiro’s first album is out and it’s a good listen, if not maybe a little one note. The standout track for me is “Great Expectation,” which has an Adele punch with a bit of Amy Winehouse swagger.
The Big Question
Ok, you’ve got to cut half of all VW Group models. Go.
Top photo: Eaglemoss, VW
TBQ: I dunno, but *not* that wagon, pictured above. Hot damn.
Right? WANT
What the auto industry really needed to do is condense all of their various models into a single form factor they could sell to everyone with no specialization. Like a Venn diagram that “crosses over” every market. Sell a small, medium, and large like they’re soda cups and maybe leave a truck or sports car if you feel like it.
The Car. Flavors available: 1, 2 or 3.
Please don’t show those x-out headlights ever again.
I has a ’01 Jetta TDI and the lighting on its gauges was incredible indeed. Easily the best instrumentation lighting I have ever seen. And durable too. All the LEDs still worked 16 years later when I sold it.
Man that’s a whole lot of words to say Volkswagen is the 2020s version of GM IN THE 70s
Minus a change of heart and fortunes, VW in North America is on its way to becoming the German Mitsubishi with twice the models and half the reliability.
Couldn’t they get rid of 73-74% of all variants just by closing down Porsche?
I don’t care what VW does. They cut the last car they sold in the US I had any interest in, the manual transmission GTI. I didn’t much care for the MK8 vs. my MK7 that I so stupidly sold, but gun to my head it was a new car I could have tolerated. But no stick, no sale.
“ Volkswagen Group CEO Oliver Blume and CFO Arno Antlitz are announcing that the way forward is a reduction of models by 50% and variants by 75%.”
It’s about time. I recall thinking years ago they had waaaaaay to many models that had way too much overlap.
And in spite of all those models, not a single competitive van or pickup truck. Their model line is ridiculous.
“Ok, you’ve got to cut half of all VW Group models. Go.”
I would start with Audi… and get rid of half of their SUVs so that all that would be left would be a clear small, midsize and large SUV.
For the cars, cut it down to just the A3 and A5.
And I’d have to get back to on all the cuts for all the other brands they have.
But part of the downsizing of models would ALSO have to involve cutting back on the many MANY engine options they have as well.
The Amarok was a pretty cool truck. Built in Argentina, I saw a bunch of them all over LATAM more than ten years ago. Chicken Tax, blah, blah, blah.
Many of them even had healthy (if not healthful) TDI engines. Three to choose from! They still make them, but as of 2022 they are based on the Ford Ranger and built in South Africa.
VW went off the road and disappeared into the weeds long before diesel-gate. Cutting costs where they were painfully obvious to even the first under warranty buyer did them in. The Old school appeal was simplicity done with durability as a priority. How have seemingly All manufacturers forgotten how to make the foundational drive train trouble free? Sure way more efficient, and power dense, but that doesn’t have to kill reliability, if you don’t put plastic where it should never be. Skip direct injection, plastic timing chain guides, sealed plastic electric water pumps, plastic plumbing, oil pans, and intake manifolds. Get the basics right without trying to cut every penny, and be dollar wise in the reduction of recalls, redesign, and warranty work. Fire the whole software group if you haven’t already, and licence the best, and the least amount necessary to comply with regulations. EV components should be off the shelf items at this point, so the only work there should be integration.
Once you get the basics right, I’ll take a new Karmann Ghia convertible.
VAG: Kill audi, let Porsche be the luxury+performance brand.
VW: Kill the atlas cross. Kill the convertible crossover. Golf goes to just the GTI model. IDBus gets a massive price cut and a better name, and the next-gen model will have a gas or diesel engine to charge the battery. Is the id3 sold in the US? Id4 gets a styling update to be less bland. There’d also be a smaller van option made, and it would be a plug-in hybrid. Let VW lead a minivan revolution against crossovers. Passat and jetta are only offered in wagon bodies, no more sedans.
Porsche: brings back the longroof they just killed. Maybe rein in some of the more outrageous designs (front of the current SUVs comes to mind).
Skoda: let them keep doing what they’re doing, but with better execution and less obvious parts sharing between the VWs they’re based on.
SEAT: Ditto^
Bentley: Probably need another model, likely a smaller SUV, but better-looking than the Bentayga. It might be Cayenne-based but would be more luxury-focused than the Porsche cousin.
Lamborghini: Urus needs to be less awkward and ugly, but not as much as an LM002. The other models are fresh enough for now.
Commercial companies: keep on keeping on for now.
Yeah, I love all the classic Vdubs all the way up to the mid 90’s Jetta body style…didn’t have one but at one point I had an 84 Jetta and 83 Rabbit GTI and those were a blast) but don’t like any newer ones except the Buzz. I’m calling it the VW Bus though…I think it’s great that they finally came out w/ it and think it looks awesome. The only way I’d buy it is if it was gas though, or a regular hybrid. It’s still too expensive or course so I’d have to have a lot of $. I do have this idea (at the moment it’s more like a joke) but I think it would be so awesome to buy one, rip out all the EV stuff and throw a Porsche engine in! (or nice VW engine) Also as sort of an “air-cooled tribute” to the classic iconic hippie buses. I hadn’t thought of this before, but if there was a way to use the batteries as “house” power and turn it into a camper (I think the camper version is coming soon too! I’d still rather make it my own) then I wouldn’t have to rip out/sell the EV parts (no one is going to buy them used anyway). There’s gotta be a way to rerig it: of course it would all be custom, cost a ton, and wouldn’t be under warranty but I don’t care about warranties. Anyway, this is all just daydreaming but it would be so awesome and fun to drive and camp in (down by the river!). Wow, this was long, thanks for listening
VW’s electric line is some of the blandest cars I have seen with the exception of Tesla, which hasnt really updated their cars ever.
I guess it depends on what VAG is calling a separate “model.” Porsche’s had so many special editions lately (which they admittedly probably sell!) that they’re starting to get into that “when everything is special, nothing is special anymore” territory, IMHO. Maybe leave those builds for people with too much money to contact Sonderwunsch themselves and direct more focus into making the bigger-volume models sell more, LOL.
But yeah, thin that Euro-herd of VW models and get some focus back on why people like the VW Group’s cars. “Simplify and add brightness” is great.
If we counted, we might find that the Golf actually has more variants than the 911…
You will be able to bring a T-Roc Cabriolet to the US a tiny little bit earlier. At around 2042, for the earliest cars.
If done right, it could work. Porsche only has like two models that anyone cares about, and the Volkswagen brand arguably reached the height of its global success with just 4 models on 3 platforms, with 1 engine family
Shout out to whoever did the lead image today. Brilliant.
The issue for me is that VW has a pretty solid reputation for Turbo Motor issues, whether the newer stuff has that licked or not is perhaps still to be seen, but with TSi memory on the brain they are in the same boat as Nissan for me, which means, not going to even look at one with a turbo. so they could probably get rid of all VW’s and I would not care at this point, Audi is kind of the same, but they add weak plastic components in terrible to reach places that fail with not a lot of time on the clock. the cars are kind of attractive, but they are arguably not better than say a Korean Knock off.
Not a huge VW fan so I’d just ask a random AI chatbot and go with whatever it says. Or, if I have to make the choice myself, have all the names printed on identically sized bits of paper, weigh all of them, then start discarding handfuls at random until the pile’s weight is reduced by 1/2.
VW currently has 23 different models – and when you look at Golf alone, the lineup includes 2 bodystyles (Wagon and Hatch) with 10 variants for the hatch (Energy, Trend, Life, Style, R-Line, GTI, GTE, GTI Clubsport, R and GTI Edition 50) and 5 for the Wagon/Combi – making 15 variants total.
Whereas Skoda has just 14 models, and of that – when you look at the Octavia and Octavia Estate/Combi – there are only 3 variants each, making 6 Octavia variants total. This is where VW needs to be.
Bentley has 5 different bodystyles – Bentayga, Bentayga EWB, Flying Spur, Continental GT and Continental GTS – which is one more than necessary. But each body style has 4 (Bentayga & Bentayga EWB) to six (Continental GT – which consists of Mulliner, Speed, Azure, GT-S and GT, plus the Supersports) variants on top of which are the Mulliner specials (Batur, etc) So of the 10K Bentley’s sold worldwide last year – there were 24 different types to choose (excluding the Mulliner limited editions) You could reduce the bodystyles to four and the trim packages to three (Mulliner, Speed and Base) across the line, making just 12 variants, and you’d still have 90+% of the options availability. Few Bentley buyers would notice or care about the difference.
But then we get to Porsche – and in the 911 lineup, of which there are 3 different bodystyles (Coupe, Cabriolet and Targa) there are 21 different variants. That makes more sense in light of the nearly 280K 911’s sold last year – but it’s still too many.
Then you look at the larger lineup, which consists of 74 variants across 6 models and 10 bodystyles — 19 variants alone for Cayenne. It’s ridiculous.
For once, a CEO is correct – – There are way too many models and variants in the VW Group portfolio, and it would take me far, far more than the 25 minutes of research and writing I did for this post plus a sizable series of spreadsheets to tell you which I’d models and variants I’d combine/eliminate.
The number of variants in the Golf, just to take an example, is a lot higher. Just in the non-sporty variants, there are several engines to choose from:
– 1.5 turbo 115bhp
– 1.5 turbo 150bhp
– 2.0 TDI 115bhp
– 2.0 TDI 150bhp
– 1.5 PHEV 204bhp
– 1.5 PHEV 272bhp
– 2.0 turbo 204bhp
And that’s not taking into account manual and automatic options, front wheel drive and four wheel drive options.
Yep – It’s a lot.
And that’s just for Europe.
The US/Canada cars are another set of variants.
First car was a 70 Beetle, so I always have had a soft spot for VW. But damn, they’ve made it hard to like them. VW was the quirky, decent but not too expensive choice for years but then they decided to be all fancy. How’s that worked out?
Go back to the old weirdness.
Golf (4dr/2dr convertible)
GTI/R
Golf pickup – would it sell? See Ford Maverick.
Karmann-Ghia reinterpretation (hardtop/convertible)
Jetta
Tiguan if you have to have an SUV
Westfalia van (hybrid or gas, not EV). Cash in on the van craze, albeit years too late.
I’d buy a 4dr, basic Golf or a Golf pickup. I’m sure as hell not paying GTI prices.
A hybrid Caddy for 25K would be a maverick killer
I hope VW keeps pumping money into scout motors long enough for me to sell my 68 800 before my Slate arrives.
It’d be great to sell it before Keogh’s Kludgy KopyKats skullf#$k what’s left of the Scout legacy. For the time being, the added interest in vintage models is padding sale prices nicely.
That’s a great description of what I’m hearing.
Time for VW to bring the Beetle back for another encore. Maybe a factory lifted Baja Beetle to cash in on the “active lifestyle” off road fad. Hell, offer it in 2 and 4 doors. The people have spoken when it comes to those extra doors on the Bronco and Wrangler.
Hot take: Drop everything except Porsche 911 and Rabbit/GTI and start over.
That ‘TBQ’ is one hellva question. I’d almost want to say cut brands: but if you start cutting from the Progressive Group or Sport Luxury Group (I’m going by Volkswagen Groups own definitions: http://www.volkswagen-group.com/en/brands-and-brand-groups-15811), it’ll make keeping the other brands a bit more difficult because you can’t synergize with the more premium brands that’ll eat some of the investment and make more profit (like the SUV’s). But VW and Audi as brands don’t seemingly sell Toyota levels of products themselves, so you’ll be taking away products those brands may actually need to stay alive. They won’t let a Chrysler-like brand hang out like Stellantis does….
Phew, that’s a doozy.
Look at what Toyota does. They are extremely successful. They did not get there by cutting brands and models, but by offering lots and lots of choices, and making them durable and dependable.
Prune things back a bit here and there, but drastic reductions are not a good long-term plan. This guy is going to create chaos and havoc in the company and then resign, taking a multimillion Euro severance package on his way out the door.
I’m never going to not see the X logo https://duckduckgo.com/?q=x+logo&t=opera&ia=web in those new BMW headlights.
I hear you. There may be an argument for trademark infringement.
No, because it wasn’t original. Musk took it out of a pre-existing font (not sure which one and can’t be bothered to check right now).
Not exactly. Supposedly it’s a bespoke symbol created be Alex Tourville, based on the Unicode U+1D54F ‘Mathematical Double-Struck Capital X’ character but “more refined”.
It’s now part of their Chirp typeface, but (if Google is to be believed) it was not taken from an existing font, just inspired by an existing math symbol.
Knowing nothing about how well their electric vehicles run or hold up, I wouldn’t mind having that I.D. 7 in the US. Has a simple handsomeness in that pic. Wish we had more wagons here