VW takes sheet from Musk’s Twitter playbook
It was an April Fool’s joke that went wrong. In an embarrassing apology, Volkswagen had to confirm at the end of March that its US rebranding in “Voltwagen” was a feat for a fully electric future.
But the botched announcement, which sparked an investigation by the Securities and Exchange Commission after it coincided with a surge in the company’s U.S. stocks, was in line with a social media strategy launched at the automaker’s German headquarters .
Last summer, VW boss Herbert Diess told employees that he wanted to be louder online. He believed the group, which is investing more than € 35 billion in electrical engineering, needs to win back the attention of the likes of Elon Musk, according to the people close to the top.
“Maybe we need a big boom,” said a strategy expert, describing the approach in which Diess went with increasingly provocative posts on LinkedIn and then on Twitter.
Diess is also active on China’s Weibo, where he is hot on the heels of the Tesla founder, who has been using social media for years to promote himself and his company, when it comes to followers.
Last year, VW launched its first own electric car, the ID.3, and sold almost 232,000 battery-operated vehicles in 2020, making it Europe’s largest electric vehicle company. By the end of the decade, the company aims to make 70 percent of its sales in Europe emission-free.
Despite these ambitions, the German company is worth less than a third of Tesla, which is building a factory just 250 miles from the VW site in Wolfsburg.
In an unusual step for Germany’s staid corporate class, Diess performed a series of stunts to get VW’s attention.
The Bavarian donned a Batman mask while showing off one of the group’s cars on a LinkedIn post, posed for a selfie with Musk when he visited VW to test the ID.3, and mocked after seeing the beginning of the Annual Twitter changed, which Tesla had playfully tried as a BMW manager to recruit Diess.
The VW boss also argued online with climate activists and politicians about the best way to achieve CO2-neutral transport.
The importance of this strategy will be underlined by a weekly social media planning meeting chaired by Diess and could last two hours, said one person. The analyzes of previous posts are worked through thoroughly and potential “viral content” for the coming days is discussed.
Some say the tactic gave VW more recognition.
“This got some attention because [Daimler boss Ola] Kallenius and [BMW’s Oliver] Zipse won’t get out of there, ”said Michael Muders, portfolio manager at Union Investment, a top 7 shareholder in VW.
“It takes a lot of money to make the transition,” he added. “It’s part of the game plan.”
The key to this plan is the ability to grab the attention of fund managers in the US, who are much more focused on VW’s younger competitors. To pursue this goal, VW has recently started its quarterly press briefings in English.
“After Dieselgate there was no interest from American investors,” said a person close to the VW board of directors. More than half of Diess’ Twitter followers are from the United States, they added.
As GM and Ford make the headlines by naming dates when they will stop selling internal combustion engines, VW is trying to emphasize that it has one over its traditional rivals in the form of specialty electric platforms, one of which is licensed to Ford Has advantage.
This technology “gives VW an edge over its competitors,” said Daniel Schwarz, an analyst at Stifel. “Now we have the European Green Deal and VW’s strategy looks even more promising.”
In addition to other events, such as a “Power Day” on the subject of battery technology, which is supposed to cause a stir on the Internet, VW’s online offensive is accompanied by a sharp increase in manufacturer shares.
This spring, despite unchanged, ambitious electric plans, the Beetle manufacturer once again wore the crown of the most valuable German stock corporation for a short time and was almost able to regain the ground that has been lost since the diesel emissions scandal in 2015.
However, it is critically unclear how much Diess’ tweets help.
Although VW shares have more than doubled since their 10-year low in March last year, Daimler shares have tripled over the same period, despite the reluctant Swedish CEO keeping Twitter away.
“I use LinkedIn because we’ve found it to be a very good tool for attracting talent to our company,” Kallenius told the Financial Times, “and I’m sticking with it for now.”
If the stock rally – partly boosted by a boom in car demand – is to continue, German carmakers will have to do more than use hashtags.
“The easy money in the market was probably made,” said Union’s Muders. “The question is how high are the margins in the electric vehicle business. That will be the focus of the market. “