Volkswagen’s Sausage Sales Outpace Cars: A Culinary Crisis?
Volkswagen, a historically dominant force in the automotive world, is facing a period filled with headwinds. The year 2024 presented the company with an unusual and somewhat concerning milestone: it sold more sausages than cars worldwide. While the company delivered 5.2 million vehicles, its food division, known for its currywurst, reached a record 8.5 million sausages sold.
This quirky statistic goes beyond the immediate novelty. It reflects a more profound set of challenges for the German automaker. Volkswagen is seeing its car sales decline in significant markets like China and Europe. This decline is made worse by the intensifying competition from Chinese manufacturers like BYD, who are gaining ground with competitively priced electric vehicles. The company’s plummet is also affecting its financial results.
Diving Deep into the Numbers
Volkswagen’s difficulties did not emerge recently. The company is actively contending with issues which have negatively affected its financial results. In 2024, the company reported a significant 30.4% drop in net profit. The rise of BYD and other Chinese manufacturers offering cheaper electric cars has accelerated these issues, causing Volkswagen to lose ground in the sustainable mobility sector. The future prospects for the company are uncertain.
Volkswagen’s Strategy for the Future
Volkswagen is responding to these challenges. The company has announced the ID. Every1, a compact electric car designed to be affordable, with a target price of around €20,000. The aim is to attract customers wanting electrification without a hefty price tag. However, the challenge of making this model profitable without sacrificing quality remains.
Whether this strategy will be successful, remains to be seen, as a failure may well lead the company into a yet more serious crisis.
The Currywurst Factor
Currywurst, a German sausage seasoned with tomato and curry sauce, has been an integral part of the company’s culture since 1973, originally created to feed the factory workers. Now, it has become a best-selling product available in supermarkets and restaurants across Germany and 12 other countries, solidifying its status as an icon within the organization. The sausage even has its own official part number in the spares catalog. But the culinary success does not solve Volkswagen’s financial problems…
Volkswagen’s attempt to remove currywurst from its Wolfsburg headquarters menu in 2021, due to aims of promoting vegetarian options, sparked a public outcry. This decision even drew criticism from the former German Chancellor Gerhard Schröder, who called it a symbol of German society. The company was forced to bring back the sausage menu.
Navigating Tough Times
In addition to the currywurst success, Volkswagen has made difficult decisions in its core business. To reduce costs, the company has announced the layoff of 35,000 employees over the next few years, especially affecting factories in Germany. Compounding these problems, the global political landscape presents further challenges. The possible return to power of Donald Trump in the United States potentially threatens tariffs on European cars, which could affect Volkswagen’s exports to North America.
Looking Ahead to 2025
Despite these pressures, Volkswagen expresses confidence in a recovery beginning in 2025. The company projects revenue growth of over 5% and continues to focus on electrification to compete with Tesla and BYD. The transition to electric cars won’t be easy, with high continuing battery prices, fluctuating government incentives, and increasingly fierce competition. This presents a complex situation for the automaker, which now sells more sausages than cars. It remains to be seen how they fare in 2025 and whether more drastic changes will be required to address their market position.
