Volkswagen AG recently announced that its luxury brands Lamborghini and Bentley will not be part of next week's Paris Motor Show, as the car group aims to save up on cash.
Volkswagen needs to cut any unnecessary spending so it can cushion costs from its emissions scandal.
One year ago, Volkswagen admitted that it had been using tampered software to tweak the results of diesel emissions tests. Since that revelation led to a series of callbacks and billions of dollars in fines and compensation payments, the carmaker is looking to rationalize costs throughout the board.
Some of the savings will fill the holes punctured in the revenue stream by the emissions scandal. Cost cuts will aid the company in fueling a massive strategic shift in the business, which is more and more interested in tapping the potential of electric vehicles.
Bentley states that instead of joining other auto brands during the Sept. 29 to 30 event in Paris, it will target smaller events and attempt to market itself more directly to potential customers. Lamborghini joined in, noting that its strategy regarding auto show attendance is under revision. The Italian brand says that it will be very picky in choosing the locations where it will display its superfast premium cars.
Not only will luxury car brands appear less in opulent show stands, but they are also focusing their marketing efforts on web-based events. Car shows are notoriously expensive for car brands, and luxury nameplates sometimes shell out millions of dollars to make their presence noticed at such events.
In a statement, Volkswagen notes that instead of a posh gala in Paris, it is opting for executive speeches on design.
Matthias Mueller, Chief Executive Officer at the group, explains that all crisis can be turned into a step forward.
"A crisis can lead to marginalisation, but it can also mark the turning point for something better," he underlines.
The automaker's interest in new technologies, particularly electric vehicles and electromobility, is nothing new to those who watch the car market.
At the Paris event, the car builder plans to unveil a new EV that has 300-miles autonomy and should be market-ready by 2018. Earlier this year, Volkswagen announced that it is pooling resources to deliver 30 new EVs by 2025.
Other carmakers will be absent from the 2016 Paris show, with notable names such as Aston Martin, Ford and Volvo giving a pass to the auto event.
