Volkswagen Group to shape digital change with its component suppliers

The Volkswagen Group is intensifying its efforts to master digital change and the associated transformation in the automotive industry together with suppliers in a future-oriented way.

Yesterday, members of the Boards of Management of the Volkswagen Group and brand visited selected partners in the FAST (Future Automotive Supply Track) initiative at the International Suppliers Fair (IZB). The motto of this year's leading industry showcase for suppliers is ‘Digitalization of mobility’.

The Volkswagen Group is now expanding the FAST initiative to other materials groups such as components for the connected car. To date, 55 strategic partners for 61 fields of competence have been named under the FAST initiative. This includes the Samvardhana Motherson Group-owned Samvardhana Motherson Peguform.

According to Matthias Müller, chairman of the Board of Management of Volkswagen Aktiengesellschaft, "The digitalisation of mobility is one of the key trends in our industry. It is, therefore, only logical that this topic should be the main focus here at the International Suppliers Fair over the next few days. Digital networking is changing our customers and their expectations concerning ‘mobility’. It is changing our products. And it is changing the way we develop, source, produce and market these products. We intend to shape this epoch-making transformation together with our partners from the supply industry."

Above: Dr Francisco Javier Garcia Sanz, Member of the Volkswagen Aktiengesellschaft Board of Management responsible for Procurement, at the first FAST Summit strategy conference in Berlin on June 1, 2016.
 

In June, the Group had launched its ‘Together – Strategy 2025’, which defines a comprehensive transformation process for the Volkswagen Group. Together with digitalisation, electrification and mobility services, one of the cornerstones of this strategy is a stronger emphasis on partnerships to place the innovative power of the Group on an even broader footing.

With reference to the motto of this year's IZB, Johann Jungwirth, Chief Digital Officer of Volkswagen Aktiengesellschaft, said: "As a result of the digital transformation of mobility, the automotive industry is experiencing the greatest disruption since the invention of the automobile. We are transforming ourselves from a hardware company into an integrated hardware, software and services company. We must keep up our efforts in the field of hardware but will also need to bring software and services up to the same high level. It is a tremendous competitive advantage for us that we already engage in close corporation not only internally, with our 12 strong Group brands, but also externally with a large number of competent partners. This also characterises our Together Strategy 2025."

Dr. Francisco Javier Garcia Sanz, Member of the Board of Management of Volkswagen Aktiengesellschaft responsible for Purchasing and patron of the IZB, said with regard to cooperation with suppliers: "The technological megatrends in the automotive industry such as autonomous driving, electrification of powertrains and the rapidly increasing pace of networking can only be mastered together with our suppliers. We need to work hand in hand, to pool our strengths and to create synergy effects. This is the only way to keep abreast of digital change. Close and constructive partnership with our suppliers will be the key to success. The Future Automotive Supply Tracks (FAST) initiative offers an appropriate framework."

55 suppliers part of FAST initiative

To date, Volkswagen has nominated 55 strategic partners as FAST suppliers in 61 areas of competence. These partners are involved in product innovation cycles within the Group at an earlier stage than was previously the case. In addition, production networks are being meshed even more closely with each other to create synergy effects and to make the best possible use of these networks. Following a successful start, the number of partners is to be increased, especially in view of the challenges posed by digitalization. Qualification discussions are currently underway.

"Thanks to the early involvement of suppliers in our processes, we have already been able to take up some ideas of our suppliers over the past few months and to take them into account from the beginning of the product creation process. This will bring innovations onto the road and to our customers faster," Garcia Sanz added.

Also read: Volkswagen picks 55 strategic supplier-partners for 'FAST' initiative