Seat Will Cut Jobs and Add Models Simultaneously

Oh, and also grow like crazy at the same time

By Brendan Moore

01.30.2008

Erich Schmitt, CEO of Volkswagen’s Spanish Seat brand, told the German newspaper Frankfurter Allgemeine Zeitung that Seat will both cuts jobs and add more car models in its drive to hit its ambitious 2018 targets.

Schmitt says Seat will cut 700 more jobs in addition to the 900 that have gone away already and also perform the alchemy of reducing production time for the popular Seat Ibiza to 18 hours from 27, when the next-generation model is launched.

Schmitt added, “We will be finished with the staff reductions in this year.”

But, wait there’s more.

“Our targets for 2018 are doubling vehicle sales to 800,000 … while … expanding our model range as well as a return on investment of more than 15 percent,” Seat Chief Executive Erich Schmitt said in the interview published on Tuesday.

Seat Leon Cupra

“Today, Seat offers only seven cars in three segments. In the next three to four years, we will have 15 vehicles in eight segments. By the year 2018, it will be 40,” Schmitt said.
Schmitt intends to retain the Toledo and add a new model called the Bolero, which comes from the Audi A4 platform and will be more substantial than the Leon.

Whew! That’s a lot of magic to be performed by Seat, but they seem confident, if nothing else. VW has huge growth goals and Seat seems to have gotten the same optimism injected into its plans.

Schmitt also added that he expected a decision from VW, the corporate parent, in the next 180 days, on whether to enter the South American market.

“Mexico and Brazil are … locations where (we) can build cars for Latin America without currency risk,” he said.

And finally, Schmitt shrugged off the suggestion that Porsche, the recently-ascendant majority shareholder of VW, was unhappy with Seat, and wanted to jettison the brand. There has been a lot of speculation that Porsche loved Skoda, Seat’s over-achieving corporate brother, hated Seat, and saw no reason to keep Seat around in the new regime. Schmitt said none of that chatter was true, and in fact, that Wendelin Wiedeking, the CEO of Porsche was one of Seat’s biggest supporters.

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Author: Brendan Moore

Brendan Moore is a Principal Consultant with Cedar Point Consulting , a management consulting practice based in the Washington, DC area. He also manages Autosavant Consulting, a separate practice within Cedar Point Consulting. where he advises businesses connected to the auto industry. Cedar Point Consulting can be found at http://www.cedarpointconsulting.com.

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4 Comments

  1. Here in Europe, Seat is thought of as making a good car, but Skoda gets all the press. Skoda also has a better retail and service network than Seat, much better.

  2. It will be interesting to see how Seat is able to make the VW platforms it has to work with different enough so that someone would want to buy it over a Skoda or VW that uses the same basic platform and engine family. It’s kind of like Chevrolet, Pontiac and Buick. You have this big box of platforms and engines from the parent company, and your job is to pick something compelling in terms of combinations, put an attractive skin on it, and sell a whole bunch of whatever it is you end up with.

  3. very cool logo design

  4. I think VW and all it’s corporate children have lost their minds. Where is all this growth going to come from? Or, more accurately, from whom? Who is going to give up their market share so that VW and it’s subsidiaries can make their huge increases in sales?

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