As of: March 1, 2024, 5:43 p.m
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Various electric vehicles roll off the assembly line at the Volkswagen plant in Zwickau.
© Jan Woitas/dpa
The end of the chip crisis has caused sales, revenue and operating profit to increase at the VW Group in 2023.
But new business is stalling, especially for electric cars.
Wolfsburg - Despite sluggish new business, VW was able to set new sales and profit records last year.
Because the backlog of orders could be processed after the end of the chip shortage, deliveries, sales and also operating profit increased, as the group announced on Friday based on preliminary figures.
But new business is weakening and high costs, especially for the core VW brand, are putting pressure on profitability.
Thanks to a strong final spurt, sales of all Group brands increased by almost twelve percent to 9.24 million vehicles in 2023.
Sales rose even more strongly, climbing by 15.5 percent to 322.3 billion euros.
A higher proportion of newer, more expensive and better-equipped vehicles boosted sales, as did higher sales prices.
However, the operating result only increased by a good two percent to 22.6 billion euros, just above the previous record result from 2022, a spokesman added.
Volkswagen did not initially provide any information on net profit.
The group plans to present the complete balance sheet for 2023 on March 13th.
E-cars are hardly ordered
“2023 was indeed a financially robust year,” said CFO Arno Antlitz in an internal interview available to the dpa.
“However, we have to prepare ourselves even better for the future.” The increase is mainly due to the backlog of orders with which VW started 2023.
Due to a lack of parts such as chips, VW was unable to build as many cars as were ordered and delivery times were long.
“We have largely processed this order backlog to a normal level,” said Antlitz.
At the same time, only a few new orders come in.
“Incoming orders are currently still below our plans for 2024.” This particularly applies to electric vehicles.
“2024 will demand a lot from us.”
CEO Oliver Blume prepared the group for a year of transition.
“2023 was an important year for the Volkswagen Group in terms of our realignment,” he said, according to the statement.
“The clean-up work has been completed.” The main course for the restructuring of the group that he initiated has now been set.
“We can build on this in 2024 and have a solid basis for an accelerated ramp-up from 2025.”
Return on sales remains low
The group was particularly dissatisfied with the return on sales, which shrank from 7.9 to just seven percent.
For every 100 euros that come in as sales, only seven euros remain in the cash register as operating profit.
This means that we are “still a long way away from the returns of our competitors,” criticized the CFO.
“This applies in particular to our volume brands, especially the Volkswagen brand.”
Billion-dollar savings and profit programs that VW has launched in its brands are intended to help.
According to previous information, the core brand VW is expected to improve earnings by four billion euros this year, and by 2026 it should reach ten billion euros.
“That is why we are looking confidently into 2024 despite the subdued economic outlook and intense competition,” said Antlitz.
Sales revenue is expected to increase by up to five percent, and the return on sales of 7 to 7.5 percent is expected to be at least slightly better than in 2023. dpa