Volkswagen Group will make its VW, Skoda and Seat brands more distinct to reduce overlaps and reduce tensions between them.
The group chief executive Matthias Mueller said its executive board had set out a new focus for the three mass-market brands in its European market based on 14 customer groups, Reuters reports.
"The key challenge is (to achieve) a perfect market coverage with clear territories for the brands," Mueller told a strategy meeting of about 400 managers in Wolfsburg on Thursday (October 12).
"We must now be able to better use the synergies that our unique alliance of brands offer than we have done to date."
The move may help to smooth relations between the brands.
VW brand sources told Reuters last week that managers and unions were seeking to curb competition from Skoda, move some of its production to Germany and make the Czech brand pay more for shared technology.
VW Group will also create greater differences between its premium brands Mueller said.