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Home/Marketing/Volkswagen ranks with GM and Toyota as one of the top-three carmakers in the world today in terms of sales volume (in units). It uses its Volkswagen brand, as well as its entire portfolio of other brands, including the luxury marques of Porsche, Audi, Bentley, Bugatti, and Lamborghini, and at the lower end, the Seat, Skoda, and Scania. What type of diversification is Volkswagen pursuing? What are the advantages and disadvantages of VW’s corporate strategy?

Volkswagen ranks with GM and Toyota as one of the top-three carmakers in the world today in terms of sales volume (in units). It uses its Volkswagen brand, as well as its entire portfolio of other brands, including the luxury marques of Porsche, Audi, Bentley, Bugatti, and Lamborghini, and at the lower end, the Seat, Skoda, and Scania. What type of diversification is Volkswagen pursuing? What are the advantages and disadvantages of VW’s corporate strategy?

Volkswagen is diversifying into comparable items using a related product diversification approach, and it is growing while pooling resources. Sharing resources in design and marketing and the economy of scale are some benefits of this method. Diversification frequently outperforms single firms or unrelated diversification and can help mitigate the effects of economic downturns in a single area. The limitations of focusing on efficiencies that jeopardize different brand identities and financial, technical, and other changes that lessen demand for autos are all disadvantages of this strategy. An additional downside of regional diversity is accommodating various customer wants in multiple regions.

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Academic.Tips. (2023) 'Volkswagen ranks with GM and Toyota as one of the top-three carmakers in the world today in terms of sales volume (in units). It uses its Volkswagen brand, as well as its entire portfolio of other brands, including the luxury marques of Porsche, Audi, Bentley, Bugatti, and Lamborghini, and at the lower end, the Seat, Skoda, and Scania. What type of diversification is Volkswagen pursuing? What are the advantages and disadvantages of VW’s corporate strategy'. 20 January.

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Academic.Tips. (2023, January 20). Volkswagen ranks with GM and Toyota as one of the top-three carmakers in the world today in terms of sales volume (in units). It uses its Volkswagen brand, as well as its entire portfolio of other brands, including the luxury marques of Porsche, Audi, Bentley, Bugatti, and Lamborghini, and at the lower end, the Seat, Skoda, and Scania. What type of diversification is Volkswagen pursuing? What are the advantages and disadvantages of VW’s corporate strategy? https://academic.tips/question/volkswagen-ranks-with-gm-and-toyota-as-one-of-the-top-three-carmakers-in-the-world-today-in-terms-of-sales-volume-in-units-it-uses-its-volkswagen-brand-as-well-as-its-entire-portfolio-of-other-bra/

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Academic.Tips. 2023. "Volkswagen ranks with GM and Toyota as one of the top-three carmakers in the world today in terms of sales volume (in units). It uses its Volkswagen brand, as well as its entire portfolio of other brands, including the luxury marques of Porsche, Audi, Bentley, Bugatti, and Lamborghini, and at the lower end, the Seat, Skoda, and Scania. What type of diversification is Volkswagen pursuing? What are the advantages and disadvantages of VW’s corporate strategy?" January 20, 2023. https://academic.tips/question/volkswagen-ranks-with-gm-and-toyota-as-one-of-the-top-three-carmakers-in-the-world-today-in-terms-of-sales-volume-in-units-it-uses-its-volkswagen-brand-as-well-as-its-entire-portfolio-of-other-bra/.

1. Academic.Tips. "Volkswagen ranks with GM and Toyota as one of the top-three carmakers in the world today in terms of sales volume (in units). It uses its Volkswagen brand, as well as its entire portfolio of other brands, including the luxury marques of Porsche, Audi, Bentley, Bugatti, and Lamborghini, and at the lower end, the Seat, Skoda, and Scania. What type of diversification is Volkswagen pursuing? What are the advantages and disadvantages of VW’s corporate strategy?" January 20, 2023. https://academic.tips/question/volkswagen-ranks-with-gm-and-toyota-as-one-of-the-top-three-carmakers-in-the-world-today-in-terms-of-sales-volume-in-units-it-uses-its-volkswagen-brand-as-well-as-its-entire-portfolio-of-other-bra/.


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Academic.Tips. "Volkswagen ranks with GM and Toyota as one of the top-three carmakers in the world today in terms of sales volume (in units). It uses its Volkswagen brand, as well as its entire portfolio of other brands, including the luxury marques of Porsche, Audi, Bentley, Bugatti, and Lamborghini, and at the lower end, the Seat, Skoda, and Scania. What type of diversification is Volkswagen pursuing? What are the advantages and disadvantages of VW’s corporate strategy?" January 20, 2023. https://academic.tips/question/volkswagen-ranks-with-gm-and-toyota-as-one-of-the-top-three-carmakers-in-the-world-today-in-terms-of-sales-volume-in-units-it-uses-its-volkswagen-brand-as-well-as-its-entire-portfolio-of-other-bra/.

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"Volkswagen ranks with GM and Toyota as one of the top-three carmakers in the world today in terms of sales volume (in units). It uses its Volkswagen brand, as well as its entire portfolio of other brands, including the luxury marques of Porsche, Audi, Bentley, Bugatti, and Lamborghini, and at the lower end, the Seat, Skoda, and Scania. What type of diversification is Volkswagen pursuing? What are the advantages and disadvantages of VW’s corporate strategy?" Academic.Tips, 20 Jan. 2023, academic.tips/question/volkswagen-ranks-with-gm-and-toyota-as-one-of-the-top-three-carmakers-in-the-world-today-in-terms-of-sales-volume-in-units-it-uses-its-volkswagen-brand-as-well-as-its-entire-portfolio-of-other-bra/.

Copy
In the recent past, both GM and Toyota ran into problems as they chased the goal of becoming the world’s leader in terms of unit sales. GM achieved this goal but lost billions in the process and ended up in bankruptcy (in 2008). Toyota then pushed output and briefly held the number-one spot in terms of unit sales but found that the emphasis on increasing output meant that quality issues arose – which then negatively affected its reputation. If you were asked to advise VW, what pitfalls would you point to that may need to be considered when attempting to be the world leader in unit output? How might VW avoid those pitfalls?
For many decades, Porsche pursued a focused differentiation strategy. Using a clear strategic profile as a focused differentiator, Porsche was very successful and very profitable. More recently, the Porsche brand has been repositioning itself from focused differentiation to broad differentiation by changing its competitive scope. What are the risks inherent in such strategic positioning? What are the benefits? Do you think Porsche will be successful in carving out a new strategic position as a broad differentiator? Why or why not?
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