It was an April Fool’s Day gone bad. In an embarrassing apology, Volkswagen was forced to confirm at the end of March that its rebranding in the United States to “Voltswagen” to embrace an all-electric future was a set-up.
Still, the botched announcement, which sparked a Securities and Exchange Commission investigation after coinciding with a surge in the group’s U.S. stocks, was in line with a social media strategy being implemented at the automaker’s German headquarters.
Last summer, VW chief executive Herbert Diess told staff he wanted to be more vocal online. He estimated that the group, which is investing more than 35 billion euros in electrical technology, needed to fight the attention of Elon Musk, according to people close to senior management.
“Maybe we need a big boom,” so one person familiar with the strategy described the approach, which involved Diess turning to LinkedIn and then Twitter with ever more provocative posts.
Diess is also active on Weibo in China, where he is behind the founder of Tesla – who has used social media for years to promote himself and his business – in terms of followers.
VW launched its first dedicated electric car, the ID.3, last year and sold nearly 232,000 battery-powered vehicles in 2020, becoming the largest electric vehicle company in Europe. By the end of the decade, it wants 70% of its sales in Europe to be emission-free.
Despite such ambitions, the German company is worth less than a third of Tesla, which is building a factory just 150 miles from the VW Group base in Wolfsburg.
In an unusual move for the German corporate class, Diess embarked on a series of stunts to get VW to notice.
The Bavarian donned a Batman mask while showing off one of the group’s cars in a LinkedIn post, posed for a selfie with Musk when he visited VW to test out the ID.3, and after joining Twitter at the start of the year, the Tesla quipped in a playful way. senior executive, who had tried to recruit Diess when he was director of BMW.
The VW boss has also been battling with climate activists and online politicians over the best way to achieve carbon neutral transport.
The importance of this strategy is underscored by a weekly social media planning meeting, which is chaired by Diess and can last two hours, one person said. Analyzes of previous posts are reviewed and potential “viral content” for the coming days is discussed.
Some say the tactic helped gain more recognition from VW.
“Diess attracted attention, because [Daimler boss Ola] Kallenius and [BMW’s Oliver] Zipse is not going there, ”said Michael Muders, portfolio manager at Union Investment, one of VW’s seven largest shareholders.
“It takes a lot of money to get the transition under control,” he added. “It’s part of the game plan. “
Key to this plan is the ability to grab the attention of fund managers in the United States, who are much more focused on VW’s younger competitors. In pursuit of this goal, VW recently started making its quarterly press calls in English.
“After Dieselgate, there has been no interest from US investors,” said a person close to the VW board. More than half of Diess’s Twitter followers are from the United States, they added.
As GM and Ford grab headlines for dates when they will stop selling combustion-engine cars, VW is trying to emphasize that it has an edge over traditional competitors, in the form of dedicated electric platforms. , one of which is licensed to Ford.
This technology “gives VW an edge over its peers,” said Daniel Schwarz, analyst at Stifel. “Now we have the European Green Deal and VW’s strategy looks even more promising. “
Along with other events, such as a battery technology-focused ‘Power Day’ designed to create online buzz, VW’s online offensive has coincided with a sharp increase in the automaker’s stock.
For a short time this spring, the Beetle-maker once again wore the crown of Germany’s most valuable state-owned company, despite no significant changes in its already ambitious electrical plans, and has almost regained ground lost since the scandal. of diesel emissions in 2015.
Critically, however, it’s unclear how much Diess’s tweets help.
Although VW shares have more than doubled since reaching their lowest level in 10 years in March of last year, Daimler shares have tripled in the same period, despite the fact that its director Swedish general booked is not on Twitter.
“I use LinkedIn because we’ve found it’s a great tool for attracting talent to our business,” Kallenius told the Financial Times, “and I’m sticking to that for now.“
If the rally in stocks – spurred in part by a boom in auto demand – is to continue, German automakers will likely have to do more than roll out hashtags.
“The easy money in the market has probably been earned,” Union Muders said. “The question is, what are the margins in the electric vehicle sector? This will be the objective of the market.