All eyes are on auto engineer Ulrich Hackenberg’s modular platforms and Volkswagen’s $70 billion investment. It’s possible that he may soon be one of the auto industry pioneers in the same mold as Henry Ford, Alfred Sloan and Taiichi Ohno. Since the glory days of Henry Ford and his Model T, the automakers around the world have thought of the "global car" as their Holy Grail.
This same basic design could be produced, in slight variations, and offered in various markets. Volkswagen’s quickly evolving "mega-platform" strategy is a formidable challenge to accomplish with its numerous vehicle types, sizes and brands, and with having to produce millions of them. This also is bound to have an impact on rivals around the world. For 30 years, Hackenberg worked on this idea. His early pitches were mostly disregarded until Volkswagen CEO Martin Winterkorn came along.
Hackenberg's fundamental rethink of vehicle platforms is helping drive the German company to the top of the global sales charts years ahead of its 2018 target. It can also turn VW into one of the most profitable automakers in the globe. There’s some risk to this plan. For instance, it could expose Volkswagen to the threat of a global recall if a single part, used in millions of cars, is defective.
However, competitors are fully aware of what Volkswagen could be headed to. In fact, majority of the top automakers in the world like Toyota and Ford have benchmarked Volkswagen's modular platforms. VW’s work on the MQB, its biggest mega-platform, started in earnest in 2007 and will be implemented over the next four years at almost $70 billion, according to Morgan Stanley.
The bank said that Volkswagen may get a huge payoff. It projected annual gross savings of $19 billion by 2019. Its gross margins approach 10%. Bernstein Research’s senior analyst Max Warburton said that the automaker is likely to unveil a record profit for 2012 of over $30 billion later this month. He added VW appears to have “unstoppable momentum” in China, the U.S., Europe and most countries in the globe.