Who owns your favourite car brands?

I remember the Volkswagen Group because of their ads which ended with “Das Auto”, which means “The Automobile” in German. Though it hasn’t imposed its name on all of them, the VW Group owns some iconic luxury car brands like Audi, Bugatti, Lamborghini and Porsche among others. So a company that creates simple, daily-use cars owns all these brands that almost everybody wants to have. The performance and sleek designs these cars boast of are awe-inspiring.

But how did all of these sports and luxury car companies come under the Volkswagen umbrella?

The Lamborghini brand was acquired in 1998 for around $111 million by Audi (owned by VW), after the Italian-born brand had only sold close to 250 cars that year. In the same year, the Bugatti brand was also acquired by the group, for around $50 million. Both of these brands were facing financial troubles due to which they were sold by their respective owners. Automobile manufacturing is a capital-intensive business and running it requires that you sell a lot, at least more than the costs you incur. The Volkswagen Group has indeed proved they are capable of handling that pressure by being in operation for over 80 years.

The Volkswagen Group's success in acquiring and managing multiple automobile brands is due to a combination of strategic planning, effective management, and a strong focus on innovation and quality. Through these acquisitions, VW has been able to expand its product portfolio, gain access to new markets, and leverage the strengths of each individual brand to create economies of scale.

The company has also invested heavily in R&D, particularly in electric and autonomous vehicles, which has helped it stay relevant with the changing times.

Additionally, Volkswagen has been successful in managing its brands effectively, allowing each one to maintain its unique identity and appeal to its target market, while also benefiting from shared resources and expertise. Imagine a car named Volkswagen Veyron! Doesn’t sound as cool, right? The image of Volkswagen and Bugatti is very different in our minds.

Because of the excellence of ex-CEO Ferdinand Piech, the group has been able to offer different products to different markets and different customers, which diversifies the company’s income streams. This has helped the company achieve financial success and become one of the largest and most successful automobile manufacturers in the world, and one of the oldest!

If you enjoyed this article, you can read more from me here. And do let me know if you want a specific topic covered. Subscribe for free to receive more posts like this every day!