Is outsourcing bad for Volkswagen?

Addressing intentions by Volkswagen AG to outsource its parts factories, Automobilwoche editor Guido Reinking contends such a plan would be a mistake for the German automaker.
Reinking supports his argue by pointing to the American automakers Ford Motor Company and General Motors Co. Both had spun off their suppliers, Delphi and Visteon, and are currently forced to assist them in their financial difficulties. He then points to Porshe and Toyota’s success in keeping their costs down while manufacturing many of their products’ components in-house. Toyota, for example, manufactures seventy percent of its Prius within the company.

Reinking finally concludes that outsourcing will do little to affect Volkswagen major issues: underutilized factories and overpaid employees.

[Source: Automotive News]

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