| Volkswagen AG's new chief executive said the | | | | automaker ceased development on the Formore |
| automaker plans a new compact model and does | | | | and discontinued Roadster. Last year, after |
| not foresee impending job cuts. Martin | | | | experiencing slow sales, the company |
| Winterkorn, former head of Audi division, | | | | announced the cancellation of Forfour and the |
| became Volkswagen's CEO this year, and has | | | | redesign of Fortwo, set to be unveiled in |
| since taken over the company's core VW brand. | | | | Europe this year. |
| | | | |
| According to Winterkorn, shortly after | | | | Volkswagen, a German Wolfsburg-based |
| taking office, he proposed the "design and | | | | automaker, is in the process of enforcing its |
| development of a new, very small, model below | | | | own restructuring plan that includes the |
| the Fox." Winterkorn described the compact as | | | | cutting of up to 20,000 jobs, trimming |
| "an economical, everyday small car that looks | | | | production expenses and implementing extended |
| attractive and is affordable." The said new | | | | working hours at its German plants. The |
| compact will be engineered to cater to a | | | | restructure program was introduced by Bernd |
| diverse market around the globe. Winterkorn | | | | Pischetsrieder, previous CEO of the company. |
| added that unlike DaimlerChrysler AG's | | | | The said introduction was made in a bid to |
| ultracompact Smart, it would have "space for | | | | compete with Asian automakers which have been |
| four people plus luggage." | | | | making steady success in the global market. |
| | | | This automaker resorted to this strategy in |
| DaimlerChrysler AG's Smart is a compact car | | | | an effort to have a bigger piece of the |
| that boasts a bunch of advantages like easy | | | | American auto market. |
| to park built that allows "nose-in" parking. | | | | |
| Smart Fortwo idea was supported by Swatch, a | | | | According to the Sueddeutsche Zeitung, a |
| Swiss watch manufacturer hence the code | | | | German newspaper, Winterkorn indicated that |
| "Swatchmobile." Later, the name was altered | | | | the company did not plan further cuts beyond |
| to SMART, short for Swatch Mercedes ART. The | | | | that. "We need the team in its current |
| function of the car is to transport two | | | | strength in order to realize additional |
| people and few luggages. | | | | projects that we are getting started now," |
| | | | Winterkorn said. Among those projects, "there |
| The production of the final Smart car was | | | | will definitely be a hybrid propulsion for |
| costly; the primary cause is the engine | | | | cars in the compact class such as the Polo |
| technology used aside from the distinct cold | | | | and Golf -- as quickly as possible," he |
| air intake. As a fact, it was more expensive | | | | added. Winterkorn, chief of VW AG, confirmed |
| than other four and five seater cars sold in | | | | that the extra production of the new compact |
| Europe. This is the very reason why the joint | | | | model could avoid further job cuts. |
| venture experienced heavy losses. Eventually, | | | | |
| Swatch pulled out from the business venture. | | | | Volkswagen, one of the biggest automakers |
| | | | around the world, has popular brands like |
| In 2005, DaimlerChrysler decided against | | | | Audi, Bentley, Skoda, Lamborghini, SEAT and |
| purchasing a 50 percent share in the NedCar | | | | the brand Volkswagen itself, which was |
| plant that produces Forfour supermini. The | | | | founded in 1937. |