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Audi diverting a third of R&D budget to electrification

Companies make promises all the time. We'll do X by Y. The new A will be our biggest seller in B. You know the drill. But it's when an automaker puts its money where its mouth is that we really stand up and take notice. That's precisely what Audi is doing as it attempts to convert 25 percent of its sales to electrified vehicles by 2025. Citing two sources with knowledge of Audi's plans, Reuters reports that around a third of the company's research-and-development budget will go to " electric cars, digital services, and autonomous driving." Of course, shifting that much money over to newer technologies means sacrifices elsewhere – Reuters' sources claim Audi will move money away from combustion engines and reduce country-specific powertrain variants, but the sources wouldn't get more specific. According to Reuters, Audi is 22nd in total sales of hybrids and EVs. That's eight spots behind Mercedes and ten spots behind BMW (not to mention hybrid-happy Lexus). Audi's only electric representatives in the US market are the A3 e-Tron and Q5 Hybrid and things aren't much better in Europe – the company needs to dump buckets of money into expanding its meager lineup to bring up the percentage of EVs it sells. Expect greater detail on Audi's electrification plans very soon – CEO Rupert Stadler will discuss the company's path forward on Wednesday at a closed-door meeting in Munich with over 2,000 managers. It's unlikely all those managers will be able to keep quiet. We'll be listening. Related Video: Featured Gallery Audi E-Tron Quattro Concept View 36 Photos News Source: ReutersImage Credit: Audi Green Audi Volkswagen Green Driving Electric Hybrid PHEV e-tron audi e-tron electrification

VW will delay projects to cope with diesel scandal

Volkswagen's diesel emissions scandal will require the sacrifice of far more than just executives and money. It's also going to result in the cancellation of various projects, a process that new CEO Matthias Mueller said "won't be painless." "We will review all planned investments, and what isn't absolutely vital will be canceled or delayed," Mueller said while addressing the embattled company's employees. The former Porsche boss also said the money set aside by the German giant – about $7.29 billion – won't be enough to cover recall expenses, fines from governments in affected countries, and the expected deluge of lawsuits from disgruntled TDI owners. According to Bloomberg, that figure probably won't even be enough to match the fines Uncle Sam is likely charge, pegged to be around $7.4 billion, according to one analyst. It's expected that VW could delay a further push for share in the North American market, which would include a $1-billion investment in its Puebla, Mexico, factory. But it will take more than cancellations and delays, analysts claim. "It's going to be tough to find projects they could chop that will actually move the needle," JPMorgan Chase's Jose Asumendi told Bloomberg. "What they really need to do is get costs under control." That, according to Bloomberg, is already setting up a showdown between management and labor. The latter wants a reduction in VW's $17.4-billion research-and-development budget – the world's largest and more than what Ford and General Motors spend combined – while the former wants to slash personnel costs. Bloomberg also spoke to analysts who claimed the company should look into reductions in purchasing costs as well as trimming sponsorships. It's impossible to know just how extreme Volkswagen will need to get with cancellations, delays, and cost-cutting, but it's becoming increasingly clear that the effects of this scandal will likely be felt far longer than the controversies that surrounded other automakers like General Motors and Toyota. Related Video: News Source: BloombergImage Credit: John Macdougall / AFP / Getty Images Earnings/Financials Green Plants/Manufacturing Recalls Volkswagen Diesel Vehicles vw diesel scandal matthias mueller

2015 Volkswagen GTI: Driving into spring with just one regret [w/video]

If you only notice one thing in the video above, it should be this: that GTI is filthy. Yes, the grossness of winter took its toll on our long-term 2015 Volkswagen GTI, covering the Carbon Steel hatch in a mess of salt-and-slush-streaked grime. The GTI was a champ during the cold months With 225/40R18 Bridgestone Blizzak winter tires offering sure-footed grip, the hatch became a dear companion to editors slogging through unsavory weather. Front-wheel-drive cars are already pretty solid for wintertime driving, and with the added traction of these tires, the GTI plowed forward without any drama. Our biggest gripe about snowy driving involved the car's Driver Assistance Package – a $695 option that, knowing what we know now, we wouldn't have ordered. First, this option positions the front camera right in the middle of the lower grille, which looks pretty terrible. But more importantly, the system can't tell the difference between slush/snow and an actual obstacle, so it constantly feels the need to warn us that we might hit something when the camera is covered in grime. Clearing the camera off isn't a problem, but the practice grew more annoying as the season continued. The Driver Assistance Package gets you front and rear parking sensors that, honestly, we find to be a bit too sensitive. It's activated in any low-speed situation, so the car freaks out whenever you take it through a car wash, and beeps if you walk up to the rear (to, say, open the hatch) while the engine is running. And because the GTI S model doesn't get you a rear-view camera, there's no real added benefit to the noise-makers. Yes, they help while parking in tight places, but if you struggle to park a vehicle the size of a Golf with its already excellent sight lines, you've got larger problems to overcome. We have other issues with the system, too – like how the forward sensors will blink in the instrument panel to tell you you're too close to the vehicle in front of you on the road, even with a four-car-length separation between vehicles. In all, these issues just don't seem to outweigh the benefits of the safety system. To us, it's not $695 well spent. But enough complaining. Really, the Driver Assistance Package has been the only issue we've had with the GTI since its arrival in January. Now that winter has finally melted away, we've enjoyed nice, warm temperatures here in Detroit – just last week, we were took the winter tires off.