Time. Patience. Grit. Determination. It will take all of these and more if Volkswagen is to succeed in its quest to become the world's largest and most profitable automaker. But there's one more thing it's going to require: money. Lots and lots of spending money.

Seamus McElroy from Autoline Detroit spent some time investigating the research and development expenditures of the world's largest car companies, and there were a few surprises. As it stands, Volkswagen is the third largest automaker, yet it spent more than the two companies ahead of it, Toyota and General Motors.

Also of note: at 5.5 percent, BMW and Honda spend the largest amount of their total revenue on R&D, but VW is only behind by a small margin at 5.4 percent. Perhaps the biggest shocker is Toyota, which spends a measly 3.8 percent of its total revenue on research and development.

Down at the bottom of the list are Chrysler, Fiat, Hyundai and Kia, the last of which spent less than a billion dollars total in R&D. We'd expect that next year's spending budget for Chrysler and Fiat will move up several notches as the dual-headed automaker continues its massive product overhaul.

The Korean duo, however, seems to manage very well indeed with its relatively small R&D spending budget. As you're likely aware, Hyundai and Kia are grabbing worldwide market share by the bucketload and have introduced a number of highly competitive models over the last few years. We'd say their return on each R&D dollar spent is quite impressive.


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  • 62 Comments
      Hazdaz
      • 3 Years Ago
      R&D spending is not indicative of what an automaker has for sale now... its indicative of what it WILL have for sale in 5 or 10 years down the line. If VW is indeed spending more than anyone else on R&D then I have to give them credit for that investment and curious to see what will come of that investment in a few years time. VW is one of those companies that I want to like their products, but with their relatively terrible quality, it makes it very tough to do that.
        • 3 Years Ago
        @Hazdaz
        [blocked]
          Hazdaz
          • 3 Years Ago
          That could definitely be a worry. I mean if it goes down for a year or even two, that's not that big of a deal, but when companies under-fund their R&D departments for a while, it will definitely start showing up in weaker and weaker products moving forward.
        kcaja1
        • 3 Years Ago
        @Hazdaz
        I've had 2 VWs for the last 5 years, both brand new, one 06 Passat and one 08 GTI and did not have any issues at all when I had them. I only kept both for 3 years so I don't know what kind of reliability issue they have after 3 years. I love VW especially the CC.
      Rich M.
      • 3 Years Ago
      hyundai and kia is grabbing market share because of their aggressive design along with media adulation, but people need to see where they're cutting costs. when you take apart a sonata or elantra you will see a lot of cheap choice of materials and parts. they do a great job on materials and parts you can see and touch but things that the majority would not know about, whew. VW needs to pump most of that R&D budget for their computers and electricals...
      KAG
      • 3 Years Ago
      I can see VW spending on R & D, my VW does have very good seats and tons of little gadgets. The build quality on the other hand is driving me crazy.
      Aurelio
      • 3 Years Ago
      they should hire some good well paid electrical engineers.
      xspeedy
      • 3 Years Ago
      I wonder if motorsport is under R&D. It is a proving ground for new tech after all.
      Myself
      • 3 Years Ago
      The word is "effective". And another thing... where all the money go if they don't spend a cent on researching design. Surely, a photocopier at Audi couldn't cost them $1 million...
      • 3 Years Ago
      [blocked]
        Alex
        • 3 Years Ago
        Pity their 'copies' are better than all other products on the market
        unywwvpc
        • 3 Years Ago
        In other words, VW spend their r&d money by very inefficient way. Hyundai is not developing pickup truck, F1 machine, super car. they only concentrate on mass market models such as Sonata/Optima and Elantra/Forte.
          Alex
          • 3 Years Ago
          @unywwvpc
          One doesn't need an F1 car and supercar models to be successful. In fact projects like that are mostly for prestige, offering no tangible benefits over producing competitive cheap, mass market vehicles.
      TheBoosch
      • 3 Years Ago
      When you consider that to include Porsche, Lamborghini, Bentley, Bugatti and Audi... it makes sense that they spend a lot.
      Alex
      • 3 Years Ago
      Pity VW's cars still suck.
        BG
        • 3 Years Ago
        @Alex
        You'd rather drive a Toyota? Complete with excitement and sophistication built in?
          Alex
          • 3 Years Ago
          @BG
          LOL I'd rather drive a Hyundai
          • 3 Years Ago
          @BG
          [blocked]
      Master Austin
      • 3 Years Ago
      If they are spending that much money then something isn't working for them because they constantly rank near the bottom in reliability...and this isnt' the past few years, this is going back as far as I can remember in the 80s... I say they get their money back...
      2 Wheeled Menace
      • 3 Years Ago
      Strange. VW has some of the most low tech engines for sale here in the united states, other than the diesel mills. Honda does too. BMW seems to be the only company getting their money's worth out of the R&D budget.
        icharlie
        • 3 Years Ago
        @2 Wheeled Menace
        Yeah in the united states... But they use a ton of other really technical motors overseas. Supercharged hybrids, turbocharged & Supercharged 4cyls, etc. Not to mention other thing such as the first mass produced dual clutch transmission. We get the 6speed here, but europe gets a 7speed dual clutch. You can see where vw spent their money in the past few years. They've come a long way in terms of quality vs 1999-2003 when they really took a quality hit.
        TelegramSam
        • 3 Years Ago
        @2 Wheeled Menace
        Hold on, he has a bit of a point. Outdated engines: 2.5 liter 5-cyl 3.x liter VR6* * I almost add this hesitantly, since they are wonderful engines. They may be a little long in the tooth. However, there is also the 2.0T FSI and the 2.0T TSI. They are both pretty modern and high tech from what I can gather. They're used on almost every model, though not at the lowest trim always.
      Sukairain
      • 3 Years Ago
      25% of their R&D budget went into creating monthly limited edition Veyrons. "Let's give it 1150hp and 3 tone paint!" "No no, save the 3 tone paint for the next special edition next month"
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