Question

The visionary strategy of the Chief Executive Officer of Volkswagen which included switching the German plants entirely to the new model, failed due to all of the following reasons except:

A) resistance on the part of German unions.
B) confusion among American dealers about where it was made.
C) investment of billions of dollars in Skoda autoworks in Czechoslovakia.
D) investment in SEAT in Spain.
E) continued demand for Beetle model in the United States.

Answer 1

The failure of Volkswagen's strategy was not due to the continued demand for the Beetle model in the U.S., but rather due to union resistance, dealer confusion, and investments in overseas plants. Hence, the correct answer is option (A).

Step-by-step explanation:

The visionary strategy of the Chief Executive Officer of Volkswagen, which included switching the German plants entirely to a new model, did not fail because of the continued demand for the Beetle model in the United States. Factors contributing to the failure did include resistance on the part of German unions, misunderstanding among American dealers about the car's origin, and substantial investments in Skoda autoworks in Czechoslovakia and SEAT in Spain.

The challenges facing Volkswagen were indicative of larger trends in the auto industry during this period, such as the shift in automobile manufacturing to low-cost locations and the impact of increased competition from global auto manufacturers, which led to the decline of unionized workforces.