Information Technology (IT)
IT Strategy
The Volkswagen Group pursues the vision of being “The Global Automotive Tech Driver”. IT is playing an ever more important role in this – used in our vehicles, across the Company and in opening up new business models.
Digitalized supply chains, automated and AI-optimized processes in all of the Company’s business areas, data-driven management of the sustainability targets and a seamless integration of analogue and digital customer experience are elements of this transformation.
The “IT” Board function applied its strategy to the development of the “Global IT” vision for the Company. It ensures the clear and synchronous orientation, global networking, sharing of knowledge, and mutual adaptability of the IT strategies of all brands and regions. The objective is standardized cross-brand and cross-regional provision of IT infrastructures, IT services, and IT solutions in appropriate bundles. This serves to reduce costs, utilize efficiencies, and leverage further potential for synergies. Distinctions are made and individual solutions provided only if specifically necessary or required under regulatory provisions.
The target dimensions are: a value contribution for the departments, an active contribution to the systematic digitalization of the Company, high speed and adaptability in implementation; and cost efficiency. Long-term IT imperatives were defined to aid target achievement. These address issues such as the transformation into a data and AI-driven company, implementation of consistent infrastructure platforms across all brands and regions, realization of a global, digital product landscape through a cross-brand, cross-regional cooperation model based on complementary skills and operational excellence in implementation. Implementation of the targeted measures is ensured through the annual Global IT Top 10 program with agile trimester sprints focused on business impact and speed. The optimized data availability of the Global IT Top 10 program creates the basis for modern AI applications and therefore the potential for Company-wide efficiencies. Systematic modularization of large IT programs helps to provide future-proof IT solutions, thereby driving the digitalization of all business areas locally and globally, for instance through the IT China strategy. The systematic introduction of the agile product organization is intended to accelerate the development and provision of digital products. In this context, IT and the Board functions work together in cross-functional teams with short development cycles to produce new digital products. The aim of the Group-wide, cross-brand IT performance program reported as part of the Global IT Top 10 program is to additionally improve performance by 30% at all levels by 2030.
We aim to ensure a uniform, strategic focus by forging technical ties between the “IT” Board function and the chief information officers (CIOs) of the Core, Progressive and Sport Luxury brand groups and of Volkswagen Financial Services AG. This interface between technical and organizational aspects also facilitates the realization of synergies and further economies of scale. The systematic identification and Group-wide sharing of best practices – projects that have been successfully implemented at individual brands and companies – is intended to enable effective knowledge transfer within the Company and generate greater speed and synergies, thus also reducing the need for resources.
The focus in IT infrastructure is on further expansion and optimization of the cooperation between the Group and its brands. This has already resulted in a significant reduction in costs and in quality optimization in some areas, and will be systematically continued. To this end, the Group has a globally uniform structure on five operating platforms/domains (cloud, mainframe, high performance computing, on premise, digital workplace) used across all brands and regions. This also involves combining our shared resources in the brands and regions, as well as the international companies of Global IT, such as in India.
Software Development
The “IT” Board function is responsible for swiftly developing and introducing software and IT solutions for the Group based on the Group’s needs. Part of this development work takes place in the Software Development Centers (SDC) around the world. The strategic goal is to safeguard and successively increase the proportion of in-house services relating to software products for critical business processes (such as technical development). This involves in particular systematic expansion of the international subsidiaries and new cooperation models with selected partners. This addresses the increasing need for software development at the Volkswagen Group. The gradual increase in in-house services will reinforce governance and ensure the efficient management and cost control of suppliers.
The optimization of processes and the definition of standards for software development remain at the forefront of our activities. Among other things, this entails international, data-driven management of activities in the SDC, strategic alignment of the business-critical enterprise systems and safeguarding intellectual property in the form of software product source codes.
Use of Digitalization and IT Solutions
The Board of Management continuously monitors and supports the digital transformation. The Group Board of Management Committee for Digital Transformation addresses the digital transformation of business processes across brands and business units. It manages the IT project portfolio and fosters the digital cultural change as well as innovations and synergies between the Group and the brands. This makes it the highest decision-making body and key navigator in the Group’s digital transformation.
The large-scale introduction of applications and artificial intelligence (AI) into multiple business processes was a focal point of fiscal year 2024. The scope of application of AI within the Volkswagen Group is broad. The goals are specific monetary savings (e.g., reduction in the consumption of electricity and materials in manufacturing processes), specific improvements in product quality and the associated indirect cost savings (e.g. improved quality processes and thus also a reduction in ex gratia and warranty costs, elimination of contracting such as translation and law firm costs), specific improvements in product quality and ergonomic benefits for employees, including faster and more transparent collaboration and support in use of systems. The focus is always on balancing the expenditure and costs for the use of AI applications with their added value for the departments and the Company as a whole. The Volkswagen Group therefore views AI first and foremost as an instrument and a tool, not as an end in itself.
The applications already integrated include Smart Quality Analytics (SQA), an IT system used for example to digitalize the analysis of field data. For quality assurance purposes, SQA records and analyzes the data from connected customer vehicles. This includes data from control units as well as error messages from workshops. Other projects are working on optimizing the order of individual working steps in vehicle manufacture (for example a painting sequence) to reduce production times and improve the use of resources.
In the field of machine learning, work is being carried out on smart management of energy use to generate sustainable electricity savings and CO2 reductions, for example in compressed air control systems. Advanced data analytics are helping to optimize the storage of replacement parts in the after-sales business, for example. Likewise, numerous bot projects are being implemented to automate business processes (robotic process automation).
Production processes are also safeguarded by AI and camera systems (computer vision). The systems and equipment in the factories are linked together in an integrated overall system. In conjunction with the different departments, Group IT is also contributing its expertise to the field of research and development. Digitalized work tools such as the “virtual concept vehicle” make the product development process faster, more efficient and more cost-effective, for example by replacing physical components with virtual components generated on the computer.
The Group Data & AI Strategy is key in the implementation of AI. The aim of the strategy is to utilize the potential of AI. To track this throughout the Group, all strategic and AI-related resolutions and work initiatives are combined in a hub-hub-spoke model. This refers to a central entity, or hub, in the Group and other hubs in the brands and companies each supported by a specialist, or spoke, in the domains and business areas. This serves to improve the coordination of the different areas of the Group in implementing AI applications, and increase their scalability and efficiency. Resources can be used as needed and as efficiently as possible for the prioritized AI solutions. This structure also enables the AI solutions to be implemented and scaled efficiently, and training materials, guidelines, and experiences to be shared effectively.
IT Security
Safeguarding data and information throughout the Volkswagen Group worldwide is one of the main tasks of IT. Strategic measures continued to be implemented in fiscal year 2024 with the Group Information Security Program. The objective of the program is to create uniform processes and solutions across the Group to further enhance information security. The findings and solutions are being implemented within the Group. The main focus is on topics that could one day pose information security risks for the Group and that need to be specially safeguarded as part of the Group’s digital transformation strategy. The program’s content and orientation are reviewed annually and updated if necessary.
The Volkswagen Group requires its suppliers to have passed TISAX (Trusted Information Security Assessment Exchange) certification. This sends out a signal regarding the security of cross-company information and data. TISAX certification is an assessment method developed by the German Association of the Automotive Industry and is based on the international industry standard and the requirements of the automotive world. The aim is for sensitive data and information to be processed securely among our suppliers.
The task of automotive cybersecurity is to avert cyberattacks on our vehicles throughout the entire product life cycle, as well as on the digital vehicle ecosystem. We have implemented Group policies based on the legal requirements of the UNECE (United Nations Economic Commission for Europe) regulation. Brand-specific organizational guidelines are being specified and implemented on this basis, taking the organizational circumstances into account.
To protect our customers’ data against cyberattacks, and to implement our solutions in conformity with national and international legislation, we have established integrated, cross-brand, cross-regional security management systems for information and cybersecurity. The cybersecurity management system required by UNECE Regulation 155 received its first UNECE CSMS certification from the German Federal Motor Transport Authority in 2021 and undergoes annual monitoring audits. It was successfully recertified for the first time in May 2024. Safeguarding the complete life cycle of our vehicles and digital mobility services has been part of standard operations since 2022.
Key central information security processes have been audited and certified in line with the international ISO 27001 framework. This is the most important cross-sectoral standard for information security and is our basis for building an appropriate information security management system for handling all sensitive information in the Group. This system is being gradually expanded. It is audited annually and recertified at required intervals.
In recent years, the introduction of the data protection management system and the data protection management organization has thus established the infrastructure for implementing and complying with data protection requirements at Volkswagen AG in the long term. Increasing digitalization and interconnectedness of business processes, new legislative initiatives with data protection relevance, and the sharp rise in the extent of international data protection legislation continue to require a high level of attention to ensure ongoing compliance with data protection requirements. Continuously raising awareness among the workforce and further standardizing and automating processes remain the focus of activities. Compliance requirements are already being integrated into the design of IT solutions and infrastructure decisions.