Volkswagen’s PLM Strategy

On their third try, Oliver Riedel, director of Process Integration and Information Management at Volkswagen, and his colleagues were going to get it right and get it fast. The selection of a product lifecycle management (PLM) software supplier, that is. “This time, the complete evaluation period was slated to take only six months. We gave all the vendors a CD with actual data from a car project and told them to come back in a week and show us what they could do with our data with a standard product.” The goal was to test the capability of each vendor’s standardized software tools, eliminating the need for the time- and money-intensive development of customizable solutions. Of the four providers that returned to the table willing to have their software put through its paces, VW selected Siemens PLM Software Teamcenter ( “We had more than 600 different criteria-technical, financial and features of products-and from this evaluation Siemens came back the leader,” Riedel says.

VW views PLM implementation, which began in May 2008 and is expected to be completed by 2011, as a key part of its goals to achieve global vehicle sales growth of 500,000 units and a quadrupling of the rate of return on investment-from the 5.9% level reported in 2006 to 21%-by 2018. According to Riedel, the eventual adoption of a single set of PLM tools will enable VW to reduce overall IT spending, while boosting efficiency through the development of continuous work procedures in the product development process, along with the ability to have immediate synchronization of critical product data throughout the world.


Unwinding Complexity

VW’s eight brands build 6.2 million vehicles per year across the globe, or roughly 24,500 vehicles per day. A typical VW vehicle has approximately 5,000 parts and when you add the number of variants off each platform-Audi A3 and Volkswagen Golf, for example-the number of parts multiplies; Riedel says VW has “more than a trillion” data points on some vehicle platforms. “When it comes to powertrain alone, the VW Group has 240 different engine offerings, and that in itself requires massive amounts of data,” he says. This will require the PLM integration to be taken in baby steps. 

Volkswagen is implementing PLM not on a particular vehicle, but on different phases of the development cycle, with an eye on testing the systems on new and existing vehicle programs. “We have decided to use two car projects, one for VW and the other for the Audi brand, and both have different process technologies, one completely new and the other was created a while ago which means we have to use a lot of old data.” Riedel explains that they will start on the bodies-in-white, and once that has been successfully accomplished, they will move on: “We will not expand it until we know we are ready for the next step.”


What Lies Ahead

While Riedel and his team will have their hands full completing the integration of Siemens PLM into their operations, they have their eyes set on the next level of optimization: Development and implementation of a global product development bill of materials (BOM), which he expects to be a priority for VW in the next few years. Once that’s wrapped, he wants Siemens to provide VW with a true set of PLM software tools that can be applied for the entire lifecycle of a vehicle program. “Covering everything from the very first idea to how the vehicle will be recycled at the end of its life. We can do this on a small scale now, but I want to see all of the disciplines brought together,” he says.