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© Volkswagen Electronics Production | December 03, 2018

E-mobility is the way forward for VW

The Volkswagen Group is investing heavily in its future. Over the coming five years to the end of 2023, the company will be spending almost EUR 44 billion alone on the future issues of e-mobility and autonomous driving in its vehicles and at its plants.
This represents about one-third of total expenditure for the 2019-2023 planning period.

“One aim of the Volkswagen Group’s strategy is to speed up the pace of innovation. We are focusing our investments on the future fields of mobility and systematically implementing our strategy”, says Herbert Diess, CEO of Volkswagen Aktiengesellschaft, in a press release.

The group is working consistently on improving earnings at all brands and companies in order to finance the enormous challenges of the future from its own resources. Programs to secure the agreed targets have been initiated by the brands and companies.

Both the capital expenditure ratio and the R&D ratio in the group’s Automotive Division are to continue to decline to a competitive level of 6 percent from 2020 onward. The net cash flow target of a minimum of EUR 10 billion by 2020 remains valid. The diesel crisis will, however, still impact cash outflows in planning years 2019 and 2020, the press release reads.

However, the groups’ joint ventures in China are not consolidated and are therefore not included in the plans. These JV-companies provide their own funding for investments in plants and products.

At the same time the group says that the talks with Ford about an industrial cooperation, which was announced earlier, are progressing positively so far. The joint development and manufacture of a range of light commercial vehicles is at the core of the envisaged cooperation.

Volkswagen expects significant synergy effects from the potential to lower costs or increase performance via scales. Ford and Volkswagen will nevertheless remain competitors, as the proposed cooperation does in no way concern commercial, marketing or pricing strategies. But the companies does not rule out additional fields of cooperation outside the light commercial vehicle segment.
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December 05 2018 3:01 pm V11.10.4-1