Production
Our international production network covers a large number of process steps from the supplier to the factory, to the assembly line and then to the dealer and customers. The long-term efficiency of this network is key to our competitiveness. In order to meet the challenges of the future, we rely on comprehensive optimizations, pioneering innovations, stable supply chains and flexible structures. The Volkswagen Group, including the Chinese joint ventures, produced 9.0 million vehicles worldwide in fiscal year 2024. This was a year-on-year decline of 3.8%. Productivity, including in the Chinese joint ventures, remained steady compared with the prior year. Excluding the Chinese joint ventures, the Volkswagen Group produced 6.2 million vehicles worldwide, a decline of 0.4% compared with the prior year. Productivity saw a decline of 0.8% and was on a level with the prior year.
Natural disasters resulted in production limitations at the Volkswagen Group in 2024. Supply chains were temporarily interrupted in particular by high water levels and flooding in Central and Eastern Europe. Thanks to the rapid action taken by all the departments involved, it was possible to maintain production activities.
Production Strategy
We are sharpening our focus in the transformation of our production and logistics, whereby our aim is to make production sustainable, minimize expenditure, streamline processes and strengthen the team.
The overarching aim is to increase productivity and profitability. This enables us to manufacture high-quality products at our sites that give customers maximum benefit at competitive prices. We are adopting a cross-brand approach for the thematic focus of our activities in order to pool the strengths and potential of our global production and logistics and take advantage of the resulting synergies.
Our strategy process is based on a scenario methodology. As part of this, the strategic orientation of production is checked at regular intervals to verify that it is up to date. This provides the thematic framework for the topics being focused on in the year in question. These range from people-related subjects such as skills forecasts, to efficient and resilient processes, safeguarding the achievement of cost targets, digitalization and the environment; and the production and logistics network.
Global Production Network
The Group’s production network encompasses 115 production sites, including our Chinese joint ventures. 70 of these sites are vehicle production plants. Standardizing production with uniform product concepts, plants, operating equipment and production processes within a product family is a key factor in our forward-looking production. We are constantly enhancing our production concepts and aligning them with new technologies to achieve ambitious targets in the individual projects. In a challenging environment, the Volkswagen Group succeeded in starting up 82 vehicle projects in 2024, 22 of which were new products or successor products and 60 were product upgrades and derivatives.
The flexible production capacities provided by our platforms allow us to respond to changing market requirements, make needs-based use of the production network and leverage synergies across brands through multibrand sites. Of the vehicle production plants for passenger cars and light commercial vehicles, almost half are already multibrand sites. Models for this approach within the Group are the Bratislava and Zwickau sites. In Bratislava, vehicles of the Volkswagen Passenger Cars, Škoda, Audi and Porsche brands are produced on the joint Modular Longitudinal Toolkit (MLB) and MQB platforms. At present, we are manufacturing vehicles of the Volkswagen Passenger Cars, Audi and CUPRA brands on the joint MEB platforms in Zwickau.
VEHICLE PRODUCTION SITES OF THE VOLKSWAGEN GROUP
Share of total production 2024 in percent
The focus in the transformation of the Volkswagen Group is on mobility solutions that are innovative, efficient, sustainable and customer-oriented, as well as geared towards profitable growth. The introduction of the MEB served as a basis for this, followed by the all-electric PPE platform for the premium and sports brands, to leverage synergies in production across the brands. This meant that electric vehicles were manufactured at 18 sites across the global production network for passenger cars and light commercial vehicles as of year-end 2024.
New Technologies and Digitalization
A focus was placed on speed and added value of IT products and on the use of artificial intelligence as part of the Group’s Top 10 program, which formed the strategic basis for new technologies and the digitalization of production in fiscal year 2024. The digital transformation is shaping the future development of our process landscape. The reorganization this involves includes a switch to value-stream- and product-oriented software development within the Group. Overall, more than 100 new applications are already available for use in the production and logistics processes. Examples range from virtual training courses for new vehicle start-ups to the identification and implementation of potential energy savings and the use of artificial intelligence. The applications are now being rolled out to over 40 plants via the Digital Production Platform (DPP) jointly developed with our strategic partner Amazon Web Services (AWS).
In the Volkswagen Group, our objective is to systematically validate digital and innovative technologies and to pilot and roll out their usage for production and logistics, with the aim of saving costs in the value chain and achieving more flexible implementation options, as well as quality improvements. The goal of the digital transformation in production and logistics is to simplify the entire process chain, make the best possible use of new technologies and establish autonomous processes. In 2024, Volkswagen continued the expansion of the ONE Log project, a logistics system based on SAP S/4 HANA. Using ONE Log, the Volkswagen Passenger Cars brand aims to shape the future of digital logistics worldwide, along with other brands including Audi and Škoda, and Volkswagen Group Components. The goal with this is uniform information processing and the standardization of logistical processes, to make optimizations scalable and drive innovative technologies centrally. The project includes the various processes such as scheduling, shipping and materials management, from goods receipt right through to the production line. The targeted digitalization campaign is intended to make our plants more robust.
Innovation activities in 2024 focused on artificial intelligence, such as for image processing (computer vision), robotics applications and in generative artificial intelligence. Volkswagen developed prioritized fields of application in 2024 and is using the first cross-brand applications to improve the efficiency of knowledge management in planning and maintenance. Other applications are being used in change and requirements management. The use of generative artificial intelligence aims to boost efficiency in the context of information processing and generation, and in production.
Zero Impact Factory
In the strategic vision of our Zero Impact Factory initiative, we are developing ideas for more sustainable production. The vision driving these efforts is a factory with the lowest possible impact on the environment. Two independent methods were developed for this purpose. The site checklist analyzes qualitative aspects of a site in 11 action areas, while the impact points method quantitatively assesses the absolute environmental impacts of a site. These methods enable us to record and reduce the quantitative environmental impact of our production sites, particularly in the action areas: climate action and energy, emissions, water and waste. We are also focusing on qualitative aspects such as the appearance of our factories, our commitment to biodiversity, protection of the soil, a functioning environmental compliance management system, improvement of our resource efficiency, and environmentally friendly mobility management for employee and goods transport.
As of 2025, the Zero Impact Factory impact points method is to replace the existing system of KPIs, which measures the reduction of the environmental impact of production (UEP). This will lead to a shift away from vehicle-specific indicators to a reduction in the environmental impact of our production in absolute terms.
We record and catalog measures in an IT system and make these available for a Group-wide exchange of best practices. In the reporting year, approximately 1,700 implemented measures in the area of environment and energy were tracked and documented. They serve to improve the infrastructure and production processes for passenger cars and light commercial vehicles, could have a positive effect on the Group’s environmental indicators, and may be beneficial from an economic perspective.
Zero Impact Logistics
The actions the Volkswagen Group is taking to achieve net carbon neutral logistics in the future include, for example, the ongoing shift of shipments from road to rail and almost complete avoidance of CO2 emissions through the use of green electricity generated from renewable energy sources on the electrified lines in rail transport in Germany and other countries in collaboration with railway companies. This is an important contribution to reducing greenhouse gas emissions in the value chain. However, a prerequisite for this is, among other things, railway network infrastructure with sufficient available capacity, especially in Germany.
There is also a focus on preparing for the use of completely battery-electric trucks and biogenic fuels in the truck network. The Volkswagen Group also transports high-voltage batteries for electric vehicles in an environmentally conscious and efficient manner, for example at the component site in Braunschweig. Here, the batteries are loaded fully automatically onto trains that run on renewable power, which then take them to the plant in Zwickau.
Group Logistics uses thirteen roll-on/roll-off charter ships to transport vehicles across the North Atlantic, two of which are powered by low-pollution liquefied natural gas (LNG). By the end of 2024, four more LNG-powered car freighters had been gradually introduced, replacing six conventionally powered ships. Group Logistics’ charter ships are more climate-friendly than other LNG-fueled marine engines because the high-pressure technology of the two-stroke engines from MAN Energy Solutions means that virtually no methane escapes. In principle, the dual-fuel engines will also enable non-fossil fuels – such as biogas (bio-LNG), e-gas (synthetic gas) from renewables and biofuel – to be used in future. This will allow carbon emissions to be reduced even further.
Since 2021, Group Logistics has been continuously operating two charter ships on European sea routes using biofuel, which produces less CO2 than conventional fossil fuels. The raw material for this biofuel is made up of used cooking oils and fats. These waste and residual materials that stem, for example, from the catering and food industries, cannot be used for further processing into food or animal feed.