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VW plans ultra-cheap car

2007-02-12 15:36
Volkswagen's new chief executive says the German carmaker plans a new compact model and has indicated it does not expect to launch another round of job cuts.

Martin Winterkorn, former head of Volkswagen's Audi division, became CEO at the beginning of this year, and has since taken control of the company's core VW brand.

He told the daily Süddeutsche Zeitung that, shortly after taking office, he proposed the "design and development of a new, very small, model below the Fox," according the article.

Winterkorn described it as "an economical, everyday small car that looks attractive and is affordable" that would be aimed at markets worldwide.

He added that, unlike DaimlerChrysler AG's ultracompact Smart, it would have "space for four people plus luggage."

Wolfsburg-based Volkswagen is in the process of cutting up to 20 000 jobs, introducing longer working hours at its German plants and trimming costs.

The program was launched by the previous CEO, Bernd Pischetsrieder, in a bid to compete with Asian carmakers and to try and secure a larger piece of the US market.

Winterkorn indicated the company did not plan further cuts beyond that, according to the Süddeutsche Zeitung.

"We need the team in its current strength in order to realise additional projects that we are getting started now," he was quoted as saying.

Among those projects, "there will definitely be a hybrid propulsion for cars in the compact class such as the Polo and Golf - as quickly as possible," he was quoted as saying.

Wheels24 comment
Such a new entry-level model could eventually replace the ageing Citi Golf in South Africa. Although VWSA has been mum about when production of the Citi Golf will end - since it is still a top-seller in SA - one can imagine that the carmaker is looking at alternatives. A new world car from VW AG could just be the solution for VWSA.

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