Despite the arduous world situations ranging from global shortages of semiconductors to the effects of the Covid-19 pandemic and the recent ongoing Russia-Ukraine war today, the German automotive manufacturer Volkswagen Group has revealed its recorded robust financial results of the total sum of €62.7billion in the first quarter of the year.
In a statement signed by Christopher Hauss, the group head of strategy and finance communications, and Christoph Oemisch, spokesperson for finance and sales, the group noted that despite a challenging global environment, the Group delivered good financial results in the first quarter. This happened by improving sales mix, better pricing, continued cost discipline, and offsetting the impact of global semiconductor and wire harness shortages by reallocating resources across its primary markets of Europe, China, and the Americas.
The company recorded a strong financial sales revenue of €62.7 billion and a strong operating profit before exceptional items of €8.5 billion, including positive effects mainly from commodity hedging activities.
These results show that the underlying operating profit of about €5 billion is much higher than the previous year, demonstrating the business’s resilience. The Group also confirms its projection for 2022 based on the results and the expected improvement in semiconductor supply in the second half of the year.
Speaking on the success recorded, the Group CEO, Herbert Diess, said that despite the tremendous problems the globe faces as a result of the tragic war in Ukraine and the ongoing pandemic scenario with its impact on supply chains, our Group had demonstrated great resilience in the first quarter.
He further stated that as a genuinely global corporation, we have vast production facilities in all of the world’s main growth and sales markets. Volkswagen’s global structure aided us in mitigating many of the present negative consequences. Volkswagen is committed to growing its global footprint, furthering its transformation into a sustainable and completely digital transportation provider, even in a more polarized world.
However, the automobile giant noted that it would continue to expand in emerging areas around the world. For instance, it added that the North American region, particularly the United States, will receive special attention, with an ambitious growth plan in place to achieve a 10% market share target by 2030. Accordingly, the Group’s battery-electric vehicle (BEV) portfolio will rise to more than 25 models by the end of the decade, putting BEVs at the heart of its strategy.
In addition, the Group intends to establish a dedicated battery cell manufacturing facility in the United States. Volkswagen just announced a $7.1 billion investment in North America to expand its BEV product line, research and development, and manufacturing.
Contemporary, Volkswagen has maintained a rapid rate of digitization and electrification in its largest single market, China. With the production of MEB-based cars set to begin in 2023, Volkswagen Anhui will become the new e-mobility center. A plant for battery systems will also begin manufacturing there next year. As a result, the Group allocated €1 billion to each of Anhui and Gotion.
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