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Thursday, May 26, 2022

Seat dissolves into Volkswagen’s electric future

Latest NewsSeat dissolves into Volkswagen's electric future

Seat has spearheaded Volkswagen’s macro project to electrify its factories and build a battery plant in Sagunto, Valencia, but as a brand it will play no role in this new phase, at least for now. The compact plug-in model, the lowest in the range, which will be produced in Martorell (Barcelona) and Landaben (Pamplona) from 2025, will be sold only under the Volkswagen, Skoda and Cupra brands. The last, second brand of the Spanish company, created only four years ago, has retained this leading role. Significant advertising resources were required as it ceased being a Seat sports line to become an independent brand, and managed to make the three all-electric models developed so far in Barcelona its own.

“We continue to insist that Seat also needs to be electrified,” explain group union sources who have condemned for years that Cupra’s undisguised commitment could end the brand’s 70-year history of being dissolved in the process of electrification. into which all car groups are immersed. The group’s management has already decided that Born, which was presented to the public at all automobile exhibitions in which the company participated with the Seat logo, will go on sale under the auspices of Cupra. And it happened again with the most modest car produced for the mass brands of the Volkswagen Group.

Despite this, in a LinkedIn post, the CEO of the German consortium, Herbert Diess, denied the biggest piece of information on Tuesday. “To be clear: Cupra doesn’t replace Seat, but helps it be more profitable.” Motu proprio, by replying to no one and responding to everyone at once, the group’s chief executive attempted to break the long-running debate about whether Seat would disappear as a brand and become a mobile company focused on car rentals. We look forward to continued success with this line of models, with updates to come for many years to come.

The company will hold a new product launch next Tuesday, which will include only the Cupra and four new models from the portfolio. The last change to the Seat catalog came two years ago with a new version of the Leon. Another best-selling Spanish brand, the Ibiza (launched in 2017), received a facelift last year that includes a review of several modifications that usually mark the middle of a model version. And Ateca, which became a landmark for the company, as it meant a debut in the urban SUV segment, was released in 2016. There are no relaxations for any of these models yet. In fact, a new compact model due in 2025 in Martorell, bearing the Cupra stamp, could replace the Ibiza, which is unlikely to have an electric successor (the Golf also seems doomed in Volkswagen’s future). “Until 2030, Seat will be there. With what models and alternatives later? We must see. In 2029, the service life of the last Seat Leon was supposed to end. This should be decided three years in advance, and this will largely depend on Cupra,” skeptically say the same sources in the union, among whom there are also fears that the debate about the future of the brand could affect the drop in sales. . Seat does not want to give an official version of the situation.

With a higher price range, Cupra delivers a better return on the investment that was needed to develop the electric vehicle platforms they have long supported in Martorel. But while Seat waits for an appointment, both Skoda and especially Volkswagen, the other two mainstream brands in the group, already have EVs on the market.

cupra gain weight

He thoroughly knows all sides of the coin.


“There are other Volkswagen Group brands that overlap with Seat, and perhaps that is why there is a search for a new niche,” says a publicist who works with the Volkswagen Group in an attempt to explain the new policy, for which he claims to be anonymous. He acknowledges that there is a “risk” to Seat’s future, but he also argues that without Cupra, the Spanish company would not have been able to increase its profitability, as has historically been claimed at the group’s headquarters in Wolfsburg. In his opinion, some of the customers that the company received thanks to the new banner would not have come from the hands of Seat models. Wayne Griffiths, the company’s president, has repeatedly stressed that with the Cupra Formentor (the company’s top model) you earn four times as much as with the Ibiza.

For the German consortium, Cupra is also a mass brand, just like Volkswagen, Skoda and Seat. But while Seat is reducing its role, first under the impact of the pandemic and then due to a lack of supplies, Cupra is gaining weight both in factories and in dealerships at the expense of a sister brand. Last year, Martorell produced 252,509 Seats (Ibiza and Arona of the same size account for half of production) and 72,533 Cupra cars, while two years earlier, in the last year before the pandemic, there were only 14,483 cars. The unions note that in 2023 the new brand will represent 150,000 units.

Seat’s strategy is no different from that of other major groups: sacrifice the auto industry’s historical obsession with volume to try and make more money from every car. Seat has been working in this direction for many years. This was first achieved when the León surpassed the Ibiza as the best-selling car, it changed that strategy with its entry into the SUV market and now the Cupra aims to be the culmination of that strategy despite Seat models showing a good position in demanding markets like Germany , which has established itself as the largest client of the Spanish company even before the appearance of Cupra.

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