I

A REPORT ON ONLINE INTERNSHIP FOR VOLKSWAGEN

Project submitted to the

SAINTGITS INSTITUTE OF MANAGEMENT

In the Partial Fulfilment of the Requirement for the Degree of

MASTERS OF BUSINESS ADMINISTRATION

By
BONNY G SKARIAH
REG.NO: MGP19MBA33

Under the guidance and supervision of

Dr. LATHA K

SAINTGITS INSTITUTE OF MANAGEMENT

KOTTAYAM

JULY 2020
 II

DECLARATION

I hereby declare that matter embodied in this report entitled ‘A REPORT OF ONLINE
INTERNSHIP FOR VOLKSWAGEN.’ is the result of the analysis of observations and
interviews carried out by me under the guidance of Dr. Latha K, Assistant Professor,
Saintgits Institute of Management. This project work has not previously formed the basis
for the award of any degree, diploma, fellowship, associate ship or any other similar title,
to any candidate of any University.

BONNY G SKARIAH

REG. NO: MGP19MBA33

 III

ACKNOWLEDGEMENT

First and foremost, I express my gratitude to God Almighty for His blessings to
complete this work.

I would like to thank everyone who has aided, supported and given proper guidance in
making this report that include parents, teachers, family and friends.

I would like to thank Dr. Latha K, Assistant professor- Saintgits Institute of Management
for offering the rightful advice, encouraging me and supporting me throughout this
research.

I would especially like to thank Dr. Roji George, Dean of Saintgits Institute of Management
for giving us the opportunity to conduct a research on the company which allowed me to
gain experience and knowledge about company.

Lastly, I would like to thank my friends, family and all others for helping in the successful
completion of this report.

BONNY G SKARIAH

REG. NO: MGP19MBA33

 IV

TABLE OF CONTENTS

CHAPTERS PARTICULARS PAGE NO.

1. INTRODUCTION
1.1 Introduction to The Study
1.2 Objective of Organisational Study
2. ORGANISATIONAL ANALYSIS
2.1 Industry Analysis
2.2 Introduction
2.3 Company History
2.4 Mission, Vision and Values of the company
2.5 Governing Body and Top Management
2.6 Organisational Structure
2.7 Products/ Services of the company
2.8 Competitor analysis
2.9 Financial Analysis
2.10 Description of supporting functions
2.11 SWOT analysis of the company
3. LEARNINGS
4. CONCLUSION
5. REFERENCES
 V

LIST OF FIGURES

TABLE DESCRIPTION PAGE NO.

NO.
1. PROFIT STATEMENT OF VOLKSWAGEN
2. BALANCE SHEET OF VOLKSWAGEN
 VI

CHAPTER 1
INTRODUCTION
 VII

1.1 INTRODUCTION

This report provides the details about the major functions and roles of VOLKSWAGEN.
It aims to give an idea about how each department act as a vital link to connect the
employees and the Management.

Name of the Company: VOLKSWAGEN

Reference to internship: My friend is working in this company.

Period of internship: From July 22nd to August 4th 2020

1.2 OBJECTIVE OF THE STUDY

The main objective of this study is to understand the organization various department and
the major functions, the origin growth and development of the industry and the
organization, the present status in the financial performance and market share of the
industry as well as the organization. The other objective of the study is:

• To study the structure of the company.

• To understand the functioning of different department.
• To get a real-life exposure to work in an organization.
 VIII

CHAPTER 2
ORGANIZATIONAL ANALYSIS
 IX

2.1 INDUSTRY ANALYSIS

As of 2013, approximately 253 million vehicles were registered in the United States.
Americans have come to equate owning a vehicle with freedom—freedom to travel, work, and
enjoy leisure activities. Since American families are often on the go, it is becoming more
prevalent for families to own one car per parent, and one car for older children, so that they can
transport other family members to activities and functions. All of this is made possible by the
automotive manufacturing industry.
Making cars, motorcycles, trucks, and other vehicles is big business, but the automotive
industry is also in the midst of many changes. The industry is made up of companies and
workers who manufacture and deliver cars, trucks, and other vehicles to companies that sell
them. Companies in the automotive industry fall into one of two primary segments: car
manufacturers and car parts manufacturers. Today’s vehicles are more complex and involve
many more parts and electronics than in years past. That has led to an increase in the number
of parts manufactured by suppliers rather than manufacturers.
Since car manufacturing is expensive, there are smaller numbers of manufacturers in the
industry. In the United States, there are three leading vehicle manufacturers: Ford, General
Motors (GM), and Chrysler. On a global basis, world leaders include Honda, Toyota, Nissan
Motors, Volkswagen, and Hyundai.

The automotive industry began in the late 1800s, when German inventors Karl Benz and
Gottlieb Daimler developed a gasoline-powered internal combustion engine. However, cars
were expensive and did not attain a wide market until Henry Ford developed his assembly-line
method for mass producing them. As more people began to own cars throughout the following
30 to 40 years, people began to view them as a necessity. Owning a car led to more freedom
and options for those who owned them. They could work across town or in the next city. They
could travel across the state or across the country to visit friends or relatives. Gasoline was
cheap and the United States had huge oil reserves, so owning a car led to opportunities and
freedoms previously unattainable. Over the years, environmental concerns, new technologies,
and economic conditions have shaped the industry into its present form.

When it comes to employment, there are many types of jobs available in the industry. At
manufacturing plants, workers are line workers or supervisors, quality control workers or
inspectors, supervisors, managers, engineers, designers, safety engineers, and executives. In
addition, there are people who provide the routine business operations any organization needs,
such as accounting, marketing and advertising, and human resources. On the supplier side, the
same types of workers are required. Sales professionals also play an important role at these
companies.

The automotive industry is vital to the United States economy and workforce. According to the
Auto Alliance, the industry directly employs 1.5 million Americans.
 X

2.2 INTRODUCTION
Details of the company
Volkswagen Group, also called Volkswagen AG, major German automobile manufacturer,
founded by the German government in 1937 to mass-produce a low-priced “people’s car.”
Headquarters are in Wolfsburg, Germany.
The company was originally operated by the German Labour Front (Deutsche Arbeit front),
a Nazi organization. The Austrian automotive engineer Ferdinand Porsche, who was
responsible for the original design of the car, was hired by the German Labour Front in 1934,
and ground was broken for a new factory in the state of Lower Saxony in 1938. The outbreak
of World War II in 1939 occurred before mass production could begin, and the factory was
repurposed to produce military equipment and vehicles. Volkswagen’s military involvement
made its factory a target for Allied bombers, and by the end of the war the factory was in ruins.
It was rebuilt under British supervision, and mass production of the Volkswagen began in 1946.
Control of the company was transferred in 1949 to the West German government and the state
of Lower Saxony. By that time, more than half of the passenger cars produced in the country
were Volkswagens.

Volkswagen production expanded rapidly in the 1950s. The company introduced the
Transporter van in 1950 and the Karmann Ghia coupe in 1955. Sales abroad were generally
strong in most countries of export, but, because of the car’s small size, unusual rounded
appearance, and historical connection to Nazi Germany, sales in the United States were initially
sluggish. The car began to gain acceptance there as the 1950s progressed, however, and
Volkswagen of America was established in 1955. The American advertising agency Doyle
Dane Birnbach was hired to represent the brand in 1959, and the result was a landmark
advertising campaign that helped to popularize the car as the “Beetle” and promoted its size
and unconventional design as an advantage to the consumer. The campaign was very
successful, and the Beetle was for many years the most-popular imported automobile in the
United States. Although Volkswagen made many detail changes to the Beetle, the basic rear-
engine design and rounded shape remained the same. The company developed other rear-
engine models with more-modern styling and improved engineering, but none were as
successful as the Beetle.

Competition from small cars with more-modern designs and the company’s increasingly
troubled finances eventually dictated a change in corporate philosophy toward developing
more-contemporary and sportier car models. As a result, Volkswagen began phasing out its
rear-engine cars in the 1970s, replacing them with front-engine front-wheel-drive designs. The
first of those new cars was the short-lived K70 in 1970, followed by the Passat in 1973. Most
significant, however, was the Golf, initially called the Rabbit in the United States, which was
introduced in 1974. The Golf was an instant sales success, effectively replacing the Beetle in
the company’s lineup and ultimately becoming Volkswagen’s best-selling model worldwide.
Joint ownership of Volkswagen by the West German government and the state of Lower
Saxony continued until 1960, when the company was mostly denationalized with the sale of
60 percent of its stock to the public. Since the 1950s Volkswagen has operated plants
throughout much of the world, including in Mexico, Brazil, China, and the United States. In
addition to passenger cars, the company also produces vans and commercial vehicles.
Volkswagen owns several other automotive companies, including Audi and Porsche in
 XI

Germany, SEAT (Sociedad Española de Automobiles de Turismo) in Spain, Skoda in

the Czech Republic, Bentley in the United Kingdom, Lamborghini in Italy, and Bugatti in
France.

2.3 COMPANY HISTORY

On May 28, 1937, the government of Germany–then under the control of Adolf
Hitler of the National Socialist (Nazi) Party–forms a new state-owned automobile
company, then known as Gesellschaft zur Vorbereitung des Deutschen Volkswagens
mbH. Later that year, it was renamed simply Volkswagen, or “The People’s Car
Company.”

Originally operated by the German Labor Front, a Nazi organization, Volkswagen

was headquartered in Wolfsburg, Germany. In addition to his ambitious campaign to
build a network of autobahns and limited access highways across Germany, Hitler’s
pet project was the development and mass production of an affordable yet still
speedy vehicle that could sell for less than 1,000 Reich marks (about $140 at the
time). To provide the design for this “people’s car,” Hitler called in the Austrian
automotive engineer Ferdinand Porsche. In 1938, at a Nazi rally, the Fuhrer declared:
“It is for the broad masses that this car has been built. Its purpose is to answer their
transportation needs, and it is intended to give them joy.” However, soon after the
KdF (Kraft-durch-Freude)-Wagen (“Strength-Through-Joy” car) was displayed for
the first time at the Berlin Motor Show in 1939, World War II began, and
Volkswagen halted production. After the war ended, with the factory in ruins, the
Allies would make Volkswagen the focus of their attempts to resuscitate the German
auto industry.

Volkswagen sales in the United States were initially slower than in other parts of the
world, due to the car’s historic Nazi connections as well as its s mall size and unusual
rounded shape. In 1959, the advertising agency Doyle Dane Bernbach launched a
landmark campaign, dubbing the car the “Beetle” and spinning its diminutive size as
a distinct advantage to consumers. Over the next several years, VW becam e the top-
selling auto import in the United States. In 1960, the German government sold 60
percent of Volkswagen’s stock to the public, effectively denationalizing it. Twelve
years later, the Beetle surpassed the longstanding worldwide production record of
15 million vehicles, set by Ford Motor Company’s legendary Model T between 1908
and 1927.

With the Beetle’s design relatively unchanged since 1935, sales grew sluggish in the
early 1970s. VW bounced back with the introduction of sportier models such as the
Rabbit and later, the Golf. In 1998, the company began selling the highly touted
“New Beetle” while still continuing production of its predecessor. After nearly 70
years and more than 21 million units produced, the last original Beetle rolled off the
line in Puebla, Mexico, on July 30, 2003.
 XII

2.4 MISSION, VISION AND VALUES OF COMPANY

Mission Statement of Volkswagen AG

We offer tailor made mobility solutions to our customers.

We serve our customers’ diverse needs with a portfolio of strong brands.
We assume responsibility regarding the environment, safety and social issues.
We act with integrity and build on reliability, quality and passion as the foundation of our work.

The mission statement of Volkswagen AG can be considered a customer-oriented mission

statement because the main focus is customer. The first line focuses on customer convenience,
the second on their diverse needs and then come accountability, ethics and passion. The focus
is on the purpose that Volkswagen serves in the global society along-with responsibility and
sustainability. Focus on accountability and sustainability has grown all the more important in
the light of the diesel scandal of 2015. The mission statement talks of the large product portfolio
of the brand, it ability to provide tailor made solutions and the increased focus on sustainability
and driver safety. While ethics and reliability are important focus areas in its business strategy,
the mission statement does not talk of market size, market position or employees. These are
also important parts of business strategy and can be included as a part of mission statement.

Vision Statement of Volkswagen AG

The vision statement of VW looks very generic as compared to its mission statement and does
not discuss in detail its focus upon future. It just indicates that VW is geared towards being a
provider of sustainable automobiles. Sustainability is not just a trend and in the field of
mobility, the focus is getting shifted towards vehicles that consumer less fuel and are less
damaging to the environment. However, a vision statement shows the future course of a brand
and where it is trying to be in the coming years. While it can be easily understood that the brand
is trying to build a more accountable image with regards to sustainability and driver safety,
there are more factors like market expansion and financial position that must be included in the
vision statement. Currently, it does not clearly state what kind of financial future the brand
wants and where it is set to move with regards to market competition.

Values of Volkswagen AG

INTEGRITY
We always strive to do the right thing. Our commitment to the truth is unwavering, both in
actions and in words.
 XIII

SERVANTS’ ATTITUDE
We only exist to serve our internal and external customers, so their concerns are always at the
forefront of our business. We will serve our clients with a genuine humility that leaves no doubt
that they are the sole focus of all of our endeavours.

ACCOUNTABILITY
A personal choice to rise above one’s circumstances and demonstrate the ownership necessary
for achieving key results: to See it, own it, solve it, and Do it. Doing it right the first time is not
our goal, but our standard. We will hold ourselves responsible for this attention to detail in all
of our duties.

CONTINUOUS IMPROVEMENT
We are a dynamic organization that constantly seeks areas of growth and innovation. This
growth starts at the personal level and continues into all aspects of our business.

TEAMWORK
Teamwork is our individual actions, brought together for our common purpose, which
subordinates our individual needs to the needs of the group. We put aside our individual needs
to work towards and accomplish the larger group objective. We cooperate, using our individual
skills, and provide constructive feedback despite any personal conflict between individuals.

FUN
Fun is key to an enjoyable workplace. It encourages energetic contributions from our team
members and creates an upbeat environment for our internal and external customers that helps
differentiate us from our competition!

2.5 GOVERNING BODY AND TOP MANAGEMENT

Management Board
Currently the Board of Management of Volkswagen AG comprises six members. Each Board
Member is responsible for one or more functions within the Volkswagen Group. Dr. Herbert
Diess is the Chairman.

The work of the Board of Management of Volkswagen AG is supported by the boards of the
brands and regions as well as by the other group business units and holdings.

Chairman of the Board of Management of Volkswagen AG

• Dr. Herbert Dies, Chairman of the Board of Management of Volkswagen AG

 XIV

Members of the Board of Management of Volkswagen AG

• Oliver Blume, Brand Group ‚Sport & Luxury

• Markus Desman, Brand Group ‘Premium’
• Gunnar Kilian, Functional Responsibility ‘Human Resources’ and Brand Group
‘Truck & Bus’s
• Hildred Dorothea Werner, Functional Responsibility ‘Integrity and Legal Affairs’
• Frank Witter, Functional Responsibility ‘Finance and IT’

Members of the Supervisory Board

The Supervisory Board is responsible for monitoring the Management and approving important
corporate decisions. Moreover, it appoints the Members of the Board of Management.

The Supervisory Board of Volkswagen AG comprises 20 members and conforms to the

German Co-determination Act.

• Hans Dieter Pötsch, Chairman

• Dr. Hussain Ali Al Abdulla, Board Member of Qatar Investment Authority
• Dr. Hesse Sultan Al Jaber, Former Minister of Information and Communications
Technology, Qatar
• Dr. Bernd Malthusian, Minister of Economic Affairs, Labor, Transport and
Digitalisation for the Federal State of Lower Saxony
• Kai Bliesener, Head of Vehicle Construction (LPP) / Automotive and Supplier Industry
Coordinator at IG Metal
• Dr. Hans-Peter Fischer, Chairman of the Board of Management of Volkswagen
Management Association (VMA)
• Marianne Heiß, CEO of BBDO Group Germany GmbH
• Jorge Hofmann, IG Metal
• Ulrike Jakob, Deputy Chairman of the Works Council at the Volkswagen AG Kassel
plant
• Dr. Louise Keiling, Entrepreneur
• Peter Mosch, Chairman of the General Works Council of AUDI AG
•
• Bertina Murkovic, Chairman of the Works Council of Volkswagen Commercial
Vehicles
• Bernd Osterloh, Chairman of the General and Group Works Councils of Volkswagen
AG
• Dr. jur. Hans Michel Piëch, Lawyer in private practice
• Dr. jur. Ferdinand Oliver Porsche, Member of the Board of Management of Familie
Porsche AG Beteiligungsgesellschaft
 XV

• Dr. rer. comm. Wolfgang Porsche, Chairman of the Supervisory Board of Porsche
Automobile Holding SE and Chairman of the Supervisory Board of Dr. Ing. h. c. F.
Porsche AG

• Athanasios Stimoniaris, Chairman of the Group Works Council of MAN SE and of

TRATON SE

• Stephan Weil, Minister-President of the Federal State of Lower Saxony

• Werner Weresch, Chairman of the General Works Council and Group Works Council
of Dr. Ing. h.c. F. Porsche AG
 XVI

2.6 ORGANIZATIONAL STRUCTURE

The Volkswagen Group is one of the leading multiband groups in the automotive industry.
The Company’s business activities comprise the Automotive and Financial Services
divisions. All brands within the Automotive Division – with the exception of the
Volkswagen Passenger Cars and Volkswagen Commercial Vehicles brands – are
independent legal entities.

The Automotive Division comprises the Passenger Cars, Commercial Vehicles and Power
Engineering business areas. The Passenger Cars Business Area essentially consolidates the
Volkswagen Group’s passenger car brands. Activities focus on the development of vehicles
and engines, the production and sale of passenger cars, and the genuine parts business. The
product portfolio ranges from fuel-efficient compact cars to luxury vehicles and also
includes motorcycles, and will gradually be supplemented by mobility solutions.

The Commercial Vehicles Business Area primarily comprises the development, production
and sale of light commercial vehicles, trucks and buses from the Volkswagen Commercial
Vehicles, Scania and MAN brands, the corresponding genuine parts business and related
services. The collaboration between the MAN and Scania commercial vehicle brands is
 XVII

coordinated within the TRATON GROUP. The commercial vehicles portfolio ranges from
pickups to heavy trucks and buses.

The Power Engineering Business Area combines the large-bore diesel engines,
turbomachinery, special gear units, propulsion components and testing systems businesses.

The activities of the Financial Services Division comprise dealer and customer financing,
vehicle leasing, direct banking and insurance activities, as well as fleet management and
mobility offerings.

With its brands, the Volkswagen Group is present in all relevant markets around the world.
The Group’s key sales markets currently include Western Europe, China, the USA, Brazil,
Russia and Mexico.

Volkswagen AG and the Volkswagen Group are managed by the Volkswagen AG Board of
Management in accordance with the Volkswagen AG Articles of Association and the rules
of procedure for Volkswagen AG’s Board of Management issued by the Supervisory Board.

To further enhance its leadership and management model, the Volkswagen Group
introduced an additional internal operational structure in spring 2018. Volkswagen is
convinced that this will allow better use of existing competences and economies of scale,
make it possible to leverage synergies more systematically and accelerate decision making.

Each brand in the Volkswagen Group is managed by a brand board of management, which
ensures its independent and self-contained development and business operations. To the
extent permitted by law, the board adheres to the Group targets and requirements laid do wn
by the Board of Management of Volkswagen AG, as well as with the agreements in the
brand groups. This allows Group-wide interests to be pursued, while at the same time
safeguarding and reinforcing each brand’s specific characteristics. Matters that are of
importance to the Group as a whole are submitted to the Group Board of Management in
order to reach agreement between the parties involved, to the extent permitted by law. The
rights and obligations of the statutory bodies of the relevant brand company remain
unaffected.

The companies of the Volkswagen Group are managed by their respective managements on
their own responsibility. In addition to the interests of their own companies, the management
of each individual company takes into account the interests of the Group, the relevant brand
group and the individual brands in accordance with the framework laid down by law.
 XVIII

At Group level, committees also address key strategic issues, for example relating to product
planning, investments, risks management and management issues. The portfolio of these
committees and the regulation landscape at Group level was revised in the reporting year
and, in the course of this, a committee was established to manage the technology strategy.
This has reduced complexity and reinforced governance within the Group.

Within our future program TOGETHER – Strategy 2025, the Organization 4.0 Group
initiative is also supporting the Company’s transformation. The aim of this initiative is to
connect activities across divisions, initiate new organizational approaches and anchor these
in the Group for the long term. This will not only enable but actively create holistic stimulus
for innovation, entrepreneurship and change.

2.7 PRODUCTS AND SERVICE OF THE COMPANY

The Group comprises twelve brands from seven European countries: Volkswagen Passenger
Cars, Audi, SEAT, ŠKODA, Bentley, Bugatti, Lamborghini, Porsche,
Ducati, Volkswagen Commercial Vehicles, Scania and MAN.
 XIX

2.8 COMPETITOR ANALYSIS

This Volkswagen (VW) is founded in the year 1937 by the German Automaker
firm. VW has an average annual production output of 12 million units leading to an
annual revenue of approximately 150 billion euros, as one of the huge International
vehicle manufacturers in the world. It has high brands contains the Seat and Skoda.

Toyota

Toyota Motors Corporation is a Japanese company that manufactures cars of Toyota

brand. And a further 9% stake in Isuzu industries and it has an 18% share in Subaru
Corporation and. In these years, with returns being aro und 250 billion dollars it is
unit production rate has been around 12 million cars.

By the middle time of 2014, Toyota was the leader of the market in India in terms of
market capitalization. Thus it is one of the strongest Volkswagen Competitors in
India and Japan other Asian countries. Distributed around the world its employees
are 365,000 thereby facilitating sales of around 10 million car models and over 6
million nameplates in a year. Few of its models include the Hino, Toyota AA,
Daihatsu, and Ranz among others.

Ford

This is also an American firm that was started and incorporated in the year 1903.
Alike other ford manufactures vehicles, automobile companies and tractors Lincoln
and SUV brands. After GM motors, it is the second -largest in the USA Ford
manufactures and sells more than 6 million car units in a year.

Used 150-billion-dollar revenue at the end of the year 2016. Its other investments
include a 10% Aston Marin stake and a further 50% in China’s Jiangling. With a
maximum of 100 plants and an average of 216,000 employees around the world, Ford
holding an operating income of up to 6 billion dollars.

Renault Nissan

This is Renault Nissan that will come to be in the year 1999 a partnership between
Renault and Nissan firms. This is by who has directl y contributed to over 8 million
annual car sales partnership and it has employed close to 490,000 staff. Among
others, some of Renault Nissan car brands add Mitsubishi, Infiniti, Datsun, Nissan,
Lada, Renault, and Alpine.
 XX

In 2016, more than 245,000 units were sold the same year and Renault Nissan became
the first-ever manufacturer of Electricity powered cars. Averagely, Sale s every year
above a million cars, even on Renault Nissan partnership manufacturers.

Hyundai

Hyundai is a South Korean firm that was founded in 1947 and manufactures not only
automobiles. But also engineering sectors, defense, and heavy machinery in
aerospace. Being a global multinational, operating income of 12 billion dollars,
Hyundai has a net.

More than 280,000 people globally employ and Its annual revenue is approximated
to be 219 billion dollars. As at the end of 2016, Hyundai has made approximately
4.8 million vehicle sales. Some of its brands carry; among others Eon, Elantra, Aslan,
and Azera. In the Asian market, Hyundai is one of the topmost strongest Volkswagen
Competitors.

BMW

BMW is an automobile firm and German Motorcycle it was formed in 1916 and this
is foremost referred to as the brand by high-end clients because of its quality and
pricing. Estimation to be 2.6 million vehicles for the Total production of output is
annually based upon the out of 2.2 million to develop revenue of approximately 100
billion euros is sold.

From the house of Volkswagen, Audi taking place in a luxury car brand has held the
highest competition from BMW, one of the strong Volkswagen brands making BWM
in the premium sports car segment.

The average number of BMW employees around the world is estimated to be

126,000. Marketed under the brand name Most BMW cars are ‘BMW’. Some others
acquire; Rolls Royce, BMW, touring Formula 1 car and BMW M among others.

Chevrolet

Chevrolet Motors firm of an American’s firm that it was de rived in the year 1911.
Other than manufacturing and selling, Chevrolet Motors also repairs, maintains and
provides insurance covers to vehicles.

It makes and sells a variety of wide range among vehicles from medium cars to
heavy-duty trucks. Some of its brands listed here are; Aveo, Captiva, Traverse,
 XXI

Suburban, Sonic and Chevrolet Spark. Alone in the USA, more than 2 million car
units every year were sold, Chevrolet.

Honda

In Tokyo Japan, Honda Automobiles is a worldwide conglomerate with its

headquarters. With a net operating income of about 500 billion Yen, its annual
revenue is roughly 15 trillion yen. All over the world, Honda has ove r 205,000
employees and it is completely ranked at the eighth largest automobile manufacturer
globally.

Honda Company has a good rating. In the case of combustion engines manufacture
and motorcycle, aside from manufacturing automobiles and motorcycles, Hon da also
makes marine, power generators, aerospace engines, garden equipment, and robotics.
About 150,000 sales its best car brand Acura creates yearly to the USA alone when
around 16 million combustion engines are sold out globally each year.

Maruti Suzuki

Suzuki is a automobiles and motorcycles, designed brand of automobiles. Excluding

it from that, this brand is also makes marine vehicles. Suzuki home market is in
Japan. Moreover, India is carrying a largest market for it. In 2017, the brand is
selling more than 1.5 million vehicles in India. In Japan, it sold out approximately
640,000 units. India as well as China have seen vast growth in their respective
markets for the passenger and tiny car brands. Suzuki is taking place in the major
competitors of Ford in India. Made slight improvement in the sales of Suzuki
motorcycles over 2017 in Japan, their overseas sales goes earl y in all markets adding
North America by the way China also.

Tata Motors

Tata is a crucial Indian brand with a global footprint which h olds huge and diverse
product portfolio acquiring buses, cars, buses and luxury vehicles. Jaguar land Rover
producers sell a wide range of premium vehicles to their potential customers all over
the world. When India is the largest market for Tata Motors, i ts other vital markets
contains US, UK and China account for the largest part on its Revenue. For fiscal
year Tata Motors is selling a total of 21,12,124 achieved revenue and vehicles units
2,95,244 Crores INR.
 XXII

Datsun

Maruti Suzuki would have designed a new model that replaces the A star and Estilo.
The Datsun GO will have competition from the new vehicle too. As per the survey,
Datsun GO is a strong in specific areas and it is the longest segment with the biggest
wheelbase. Datsun GO can beat rivals while it comes with entry-level car buyers
provide necessary interior design with good mileage.
 XXIII

2.9 FINANCIAL ANALYSIS

Profit and loss account

PROFIT & LOSS MAR '20 MAR '19 MAR '18 MAR '17 MAR '16
ACCOUNT OF
VOLKSWAGEN (in
Rs. Cr.)

12 mths 12 mths 12 mths 12 mths 12 mths

INCOME

Sales Turnover 261,067.97 301,938.40 295,409.34 274,492.12 277,660.59

Net Sales 261,067.97 301,938.40 294,619.18 269,692.51 277,660.59

Other Income 101.71 -28,855.33 6,773.13 -4,700.04 2,796.36

TOTAL INCOME 258,938.49 271,029.79 303,438.89 272,392.39 283,207.94

EXPENDITURE

Raw Materials 164,899.82 194,267.91 190,107.14 175,713.19 168,230.20

Power & Fuel Cost 0.00 0.00 1,308.08 1,159.82 1,143.63

Employee Cost 30,438.60 33,243.87 30,300.09 28,332.89 28,880.89

Other Manufacturing 0.00 4,224.57 3,531.87 3,413.57 3,468.77

Expenses

Miscellaneous 45,511.29 43,484.44 27,923.61 30,185.59 37,382.47

Expenses

TOTAL EXPENSES 240,849.71 275,220.79 262,139.38 247,503.74 239,105.96

OPERATING PROFIT 17,987.07 24,664.33 34,526.38 29,588.69 41,305.62

PBDIT 18,088.78 -4,191.00 41,299.51 24,888.65 44,101.98

PBDT 10,845.45 -9,949.60 36,617.72 20,650.64 39,212.90

Depreciation 21,425.43 23,590.63 21,553.59 17,904.99 16,710.78

 XXIV

Profit Before Tax -10,579.98 -33,540.23 15,064.13 2,745.65 22,502.12

PBT (Post Extra-ord -10,579.98 -33,540.23 15,064.13 2,745.65 22,502.12

Items)

Tax 395.25 -2,437.45 4,341.93 3,251.23 3,025.05

REPORTED NET -10,975.23 -29,035.73 6,710.65 5,961.36 11,100.72

PROFIT

Share Of P/L Of 1,000.00 -209.50 -2,278.26 -1,493.00 -577.47

Associates

Net P/L After Minority -9,199.41 927.36 7,116.22 6,442.00 18,143.53

Interest & Share Of
Associates

Total Value Addition 75,949.89 80,952.88 72,032.24 71,790.55 70,875.76

Equity Dividend 0.00 0.00 0.00 0.00 0.00

Corporate Dividend 0.00 0.00 0.00 0.00 0.00

Tax

PER SHARE DATA

(ANNUALISED)

Shares in issue (lakhs) 35,977.00 33,958.51 33,958.51 33,958.51 33,956.80

EARNING PER -30.51 -85.50 19.76 17.55 32.69

SHARE (RS)

Book Value (Rs) 175.33 177.21 281.01 170.98 232.51

 XXV

BALANCE SHEET

BALANCE SHEET OF MAR 20 MAR 19 MAR 18 MAR 17 MAR 16

VOLKSWAGEN (in
Rs. Cr.)

12 mths 12 mths 12 mths 12 mths 12 mths

EQUITIES AND
LIABILITIES

SHAREHOLDER'S
FUNDS

Equity Share Capital 719.54 679.22 679.22 679.22 679.18

TOTAL SHARE 719.54 679.22 679.22 679.22 679.18

CAPITAL

Reserves and Surplus 62,358.99 59,500.34 94,748.69 57,382.67 78,273.23

TOTAL RESERVES 62,358.99 59,500.34 94,748.69 57,382.67 78,273.23

AND SURPLUS

TOTAL 63,078.53 60,179.56 95,427.91 58,061.89 78,952.41

SHAREHOLDERS
FUNDS

Minority Interest 813.56 523.06 525.06 453.17 432.84

NON-CURRENT
LIABILITIES

Long Term Borrowings 83,315.62 70,973.67 61,199.50 60,629.18 50,510.39

Deferred Tax Liabilities 1,941.87 1,491.04 6,125.80 1,174.00 4,474.78

[Net]

Other Long Term 17,780.94 16,714.92 13,904.33 28,802.14 17,830.29

Liabilities

Long Term Provisions 14,736.69 11,854.85 10,948.44 9,004.46 7,891.01

TOTAL NON- 117,775.12 101,034.48 92,178.07 99,609.78 80,706.47

CURRENT
LIABILITIES
 XXVI

CURRENT
LIABILITIES

Short Term Borrowings 16,362.53 20,150.26 16,794.85 13,859.94 11,450.78

Trade Payables 66,398.21 68,513.53 76,939.83 62,532.57 57,580.46

Other Current 47,364.27 46,596.89 41,531.29 33,429.25 32,173.68

Liabilities

Short Term Provisions 10,329.04 10,196.75 7,953.50 5,807.76 5,844.51

TOTAL CURRENT 140,454.05 145,457.43 143,219.47 115,629.52 107,049.43

LIABILITIES

TOTAL CAPITAL AND 322,121.26 307,194.53 331,350.51 273,754.36 267,141.15

LIABILITIES

ASSETS

NON-CURRENT
ASSETS

Tangible Assets 161,952.37 72,619.86 73,867.84 59,594.56 64,927.07

Intangible Assets 0.00 37,866.74 47,429.57 35,676.20 41,544.89

Capital Work-In- 0.00 8,538.17 16,142.94 10,186.83 6,550.97

Progress

FIXED ASSETS 161,952.37 142,370.44 161,330.91 128,969.60 132,390.90

Non-Current 5,446.94 6,240.89 5,651.65 5,296.77 4,533.98

Investments

Deferred Tax Assets 5,457.90 5,151.11 4,158.70 4,457.34 3,957.03

[Net]

Long Term Loans And 782.78 407.42 495.41 753.66 503.88

Advances

Other Non-Current 28,116.96 28,845.64 23,624.55 17,483.92 15,071.89

Assets

TOTAL NON- 202,534.01 183,763.37 195,377.67 157,634.61 157,217.48

CURRENT ASSETS
 XXVII

CURRENT ASSETS

Current Investments 10,861.54 9,529.83 15,161.10 15,041.15 19,233.04

Inventories 37,456.88 39,013.73 42,137.63 35,085.31 32,655.73

Trade Receivables 11,172.69 18,996.17 19,893.30 14,075.55 13,570.91

Cash And Cash 33,726.97 32,648.82 34,613.91 36,077.88 30,460.40

Equivalents

Short Term Loans And 935.25 1,268.70 2,279.66 710.45 1,117.10

Advances

OtherCurrentAssets 25,433.92 21,973.91 21,887.24 15,129.41 12,886.49

TOTAL CURRENT 119,587.25 123,431.16 135,972.84 116,119.75 109,923.67

ASSETS

TOTAL ASSETS 322,121.26 307,194.53 331,350.51 273,754.36 267,141.15

2.10 DESCRIPTION OF SUPPORTING FUNCTION

Departments are the entities organizations form to organize people, reporting
relationships, and work in a way that best supports the accomplishment of the
organization's goals. Departments are usually organized by functions such as human
resources, marketing, administration, and sales but, a department can be organized in any
way that makes sense for the customer. Departments can also be organized by customer,
by product, or by region of the world.

• Human Resource Department

• Production Department
• Marketing & Sales Department
• Finance Department
• Purchase Department
 XXVIII

Human Resource Department:

Working in Human Resources at Volkswagen means utilising the knowledge and

experience, strength and motivation of employees in such a way that the potential of every
individual can develop to the full. Volkswagen needs a top-class team, characterised by
dedication, expertise and fitness. We offer our employees excellent support, which
makes Volkswagen stand out from the competition as an employer. This strengthens the
loyalty of employees to the company and motivates them to give their best on behalf
of Volkswagen. Every day. We therefore implement modern, competitive personnel
concepts that help to secure jobs at the Volkswagen sites and make Volkswagen the most
successful and most attractive employer. Human Resources is more than a recruitment and
administration service: We make a vital contribution towards value creation and the
success of the company – and offer our employees a fulfilling and successful career
at Volkswagen.

The H R manager has following functions:

• To maintain good relationship between the employer and employees.

• To maintain good cooperate relations.
• To select right type and number of employees.
• Recruitment of employees Manpower.
• Performance review of employees.
• Maintenance of all personnel records.
• Co-ordination with the other department in recruitment of employees.
• To comply with norms of state government and statutory bodies
• To maintain effective and efficient work force.

Production Department:
There is nothing new about the idea of turning used parts into new. Way back in 1947,
Volkswagen became the first carmaker to offer a range of remanufactured parts, all of them
backed by warranty. This initiative proved so popular that many other car brands launched
similar projects of their own. The Genuine Remanufactured Parts of today, which are available
from Volkswagen, Volkswagen Commercial Vehicles, Audi, Seat and Skoda, allow customers
to not only save themselves a lot of money, but also help the environment.
 XXIX

Marketing and Sales Department:

The Volkswagen Passenger Cars brand is present in more than 150 markets throughout the
world and produces vehicles at over 50 locations in 14 countries. In 2019, Volkswagen
delivered 6.3 million vehicles including bestselling models such as the Golf, Tiguan, Jetta or
Passat. Currently, 195,878 people work for Volkswagen across the globe. The brand also has
over 10,000 dealerships with 86,000 employees. Volkswagen is forging ahead consistently
with the further development of automobile production. E-mobility, smart mobility and the
digital transformation of the brand are the key strategic topics for the future.

Finance Department:
For 50 years, Volkswagen Financial Services has been working to provide our customers with
reliable, quality service. We have many years of experience in the Indian market and are
supported by Volkswagen Financial Services AG, the financial entity of
the Volkswagen Group. This allows us to guarantee worldwide service coverage, as well as the
offer of finance products for each of the Group's automotive brands. We provide a
comprehensive solution for financing, leasing, after-sales service and insurance
of Volkswagen Group vehicles. We move so you never need to stop! Our Financial solutions
are as diverse as the customers of Volkswagen Financial Services. A one stop shop for all your
financial requirements- tailored to your needs from the various new-age finance and insurance
products. With Volkswagen Financial Services you have a whole range of products and
services designed to get you one step closer to your dream vehicle and make you enjoy it with
peace of mind.
The following attractive features and benefits of Volkswagen Finance make it one of the
most-preferred financiers amongst customers:

• Innovative financing solutions

• Attractive and competitive interest rates
• Long Tenure Funding
• Bundled Products
• World Class customer experience

Purchase Department:

The task of the department for purchasing operational resources, services and investments at
Volkswagen Slovakia is to provide the plants in Bratislava, Martina and Košice with
operational resources, services and investments.

The department analyses and negotiates offers and then decides about awarding a contract
according to the strategy of the Volkswagen Group. The decisive factors are:

• Quality
• Deadlines
• Expenses
• Innovation Potential
 XXX

2.11 SWOT ANALYSIS

Strengths.

Large Product Portfolio:

Volkswagen owns 12 brands. Its business consists of two main divisions including Automotive
and financial services divisions. The automotive division is made up of three segments
including Passenger cars, commercial vehicles and power engineering. This division of
Volkswagen makes and sells passenger cars, light commercial vehicles, trucks, buses and
motorcycles, as well as genuine parts, large-bore diesel engines, turbomachinery, special gear
units, propulsion components and testing systems. The Ducati brand operates under the Audi
brand and falls under the Passenger Cars Business Area.

The company made around 11 million vehicles in 2018 and sold 10.9 million units. Vehicle
sales grew by around 1.1% in 2018 compared to the previous year. Sales revenue grew by 2.7%
in 2018 against the previous year.

Research & Development: -

Volkswagen is an innovative brand. The company invests a large sum every year in research
and development. Competition in the automobiles industry is very high and to retain its market
leading position, the company places heavy focus on innovation. Research and development
expenses of Volkswagen in 2018 grew to $13.6 billion against $13.14 billion in 2017. The
company is planning to invest € 30 billion in electrical driving over the next five years. It also
plans to expand its portfolio of electric cars to 50 models by 2025.

Financial Strength: -

Despite the challenging situation, financial performance of Volkswagen has improved every
year. Revenue of the brand grew to €235.85 billion in 2018 from €229.55 billion in 2017.
Operating profit of Volkswagen climbed to €17.1 billion in 2018. Gross Profit was €46.35
billion in 2018, rising from €43.55 billion in 2017.

Customer base: -

Volkswagen has a large portfolio of several brands that target various customer segments. It
offers a large product range including competitively priced passenger cars, luxury cars, SUVs
and trucks. The company has a large customer base from several countries all over the world.
It has operations across more than 150 countries. A large customer base offers some major
advantages like superior sales and more consistent financial performance. In 2018, the global
car market share of Volkswagen rose to 12.3%.

International presence: -

Volkswagen has a large international business empire that spans 153 countries. The
Volkswagen Group operates 122 production plants in 20 European countries and 11 more
countries in the Americas, Asia and Africa.
 XXXI

Weaknesses.

Weakened Image: -

Brand image is an important strength in the automobile business. VW's brand image was hurt
by the recent Diesel scandal. The company has been able to manage the issue successfully to a
large extent in the following years. However, the effect was still severe on its financial
performance and business operations. Excluding the heavy financial loss it incurred, the brand
was forced to make strategic changes across entire operations to strengthen its image.

Product Recalls:

A high number of product recalls can lead to loss of credibility and brand image.
Volkswagen made around 662,000 recalls in 2019 July. The company had discovered the
problem in early 2019. Again towards the end of July, the company announced recall of
around 27,800 cars and SUVs.

High Operational Costs:

Growth in the prices of raw material, labor and other things is causing an increase in operating
expenses. Year by year, the operating expenses of Volkswagen have kept growing. Total cost
of sales of VW in 2018 were €189.5 billion Euros compared to €186 billion Euros in 2017.

Opportunities.

AI and Emerging Technologies: -

The emerging technologies including AI, digital technoilogy and autonomous driving have
brought new opportunities for the automobile brands. VW is working to transform its core
business portfolio. One of its central focuses is developing self-driving system for autonomous
vehicles and artificial intelligence. Investing in AI and other emerging technologies will also
help the brand grow its competitive advantage.

Marketing and Customer Engagement: -

Digital technology has brought excellent marketing and customer engagement opportunities
for automobile brands. Using the technology to form stronger relationships with customers will
help create a stronger image and retain more customers.

Social media, blogs and company websites can be great channels for customer and employee
engagement. VW is using some of them. However, it must use both content and video
marketing in plenty to attract and engage customers on various issues including environment,
sustainability and electric mobility.

Partnerships: -

The company can grow through partnerships. It has several strategic partnerships in place
already. Its partnership with Microsoft has helped it grow fast into a mobility service provider.
The company has also entered several more strategic partnerships to grow its business empire
in Europe, China and U.S. Sinotruck is a strategic partner of VW group in China. Partnering
 XXXII

with the technology companies in the field of research and development is also helping VW
achieve faster growth. The company is looking forward to entering more such strategic
partnerships in regional markets to achieve revenue growth and market expansion.

Threats.

Regulatory Pressure: -

Regulatory pressure in the automobile industry has kept growing over the past several years.
Companies are under more pressure than ever due to higher regulation. Taxes and tariffs are
also affecting the bottom line. The diesel scandal gave a severe blow to its cash flow.
Regulatory pressures are adding to the compliance costs. The company lost around €25 billion
in the diesel emissions case. International expansion is also being difficult due to higher
regulatory pressure.

Intense Competition: -

The automotive industry has seen growth in demand over the recent years. This has led to
higher sales but competition is also more intense now. There are many competitors of
Volkswagen Group in the international automobile industry. Several of these are major
international players. VW spends a lot on research and development and management of its
international operations to retain its competitive edge. Competition also adds to the operating
expenses and each player invests enormous sums in marketing and innovation.

Currency Fluctuations: -

Currency exchange rate fluctuations and changes in the economic environment of the regional
markets can have a negative effect on the profitability of VW. In 2018, currency fluctuations
had a negative impact on the profits of several of its brands including Skoda in 2018. Skoda's
operating profits fell by 14.6% in 2018 compared to the previous year. This was caused partly
by fluctuation in currency exchange rates among other factors like growing personnel
expenses.
 XXXIII

CHAPTER 3- LEARNING FROM ONLINE

INTERNSHIP
LEARNINGS:

1) It helped me gain an overall knowledge about the company, its history, products
and services, and its functional departments.
2) It helped me improve my communication skills as I had to contact a few individuals
in gaining information.
3) It helped me understand the nature of employees, HR policies and the process of
recruitment in the company.
4) Improved my knowledge and understanding of the theoretical aspects learned in
regard with the information collected.
5) Improved my knowledge of inventory management, warehousing and the software
used in inventory management and distribution of products.
 XXXIV

CHAPTER 4: CONCLUSION

The Volkswagen Company gets perceived in the value chain analysis as a company that strikes
a balance between low cost in manufacturing and provision of superior quality vehicles. The
vehicles boast of excellent designs, quality and innovative input regarding the latest technology.
These characteristics of the company could be great influences to the customers ‘appreciation
and make them willing to pay a little bit more for the cars (Raslavičius et al., 2015).The
company still needs to ensure that the premium costs of the vehicles are above the
differentiation costs to avoid losses as they try to impress the customers. The process of value
creation also depends on the undertakings of the value chain of the company. The company
can, therefore, create value from the resources, capabilities and core competencies by ensuring
appropriate differentiation mechanisms to yield high quality and impressive vehicle designs.
There sources would help the company in obtaining the right materials and developing the best
manufacturing platforms. The capabilities would be instrumental in converting the materials
into valuable automobiles while the core competencies would complete the equation by striking
a balance between the excellent designs and the profitability of the business (Rugraff, 2012).
Busing these techniques, the company would manage to establish a strong business presence
to overcome the competitive forces in the general business environment.
 XXXV

REFERENCES:
https://www.volkswagenag.com/ir/Y_2015_e.pdf

https://www.britannica.com/topic/Volkswagen-Group#:

https://www.google.com/search?ei=39ssX9TrKf2S4-EPlfaW-
Aw&q=Finance++department+of+volkswagen&oq

https://www.google.com/search?bih=706&biw=1536&hl=en&ei=viMsX7eJGLyf4-
EPy7qJwA0&q