The Globalization of VolkswagenBACKGROUNDSince its beginnings in 1938, when the German government laid the foundation for the first Volkswagen factory to build a "people's car", Volkswagen has experienced periods of testing and prosperity. Barely surviving the end of World War II, this company has had several different leaders to take it in many different directions, some bringing prosperous growth and others defeat and loss of investment. Competition brought VW to its knees in the late 1980s and early 1990s, and they faced defeat if they failed to turn things around to compete with new Japanese manufacturing and production that was reducing the costs of cars, making them more affordable and attractive. At the beginning of 1993, Ferdinand Piech took over as CEO of Volkswagen and began implementing his plan to turn around the company's future. Piech transformed VW into a powerful global player by buying up other well-known automobile brands, such as Bentley, Bugatti and Lamborghini, to add them to the Volkswagen industry. In 2000, Volkswagen became the first to sell more than 5 million cars worldwide, increasing its global market value by 12.4 percent compared to the previous year. It recorded the highest profits in history, reaching 2.9 billion euros after tax, which at the time was equivalent to almost 3.5 billion US dollars. STRATEGY In 1993, when Piech took over comes up, it had to solve serious problems in order to produce a profit in the years to come. One of the main concerns was production costs. They needed to find a more efficient and less expensive way to produce the various Volkswagen models. This is the biggest area where they were losing the competitive battle: the cost of their product. They needed a strategy that would solve their current problems and also be able to easily adapt to upcoming changes to enable a growing market. Piech came up with the idea of ​​using platform development. Platform development is used in vehicle production and the basic principle is that all Volkswagen models would have relatively the same basic structures. The consistency of the structures allowed faster production of the parts to be assembled and less complexity in the differences between the models. Piech, however, wanted Volkswagen models to remain distinct in their own style, as buyers moved towards individualizing their cars..