VW Group (Part 2): Increasing sales of SUVs and electrified vehicles
2020 global sales fall 15% to 9.31 million units, operating profit drops by half to EUR 10 billion
2021/02/19
- Summary
- Deliveries in China and Europe decline 9.1% and 21.6% y/y, respectively
- Financial results for the period Jan.-Sep. 2020: Sales revenue declines by 16.7% to EUR 155.5 billion, operating profit falls by 83.9% to EUR 2.4 billion
- New model launch plan: VW brand releases Taos SUV for the Americas and Golf Variant
- Reducing production in Europe, China and the US due to semiconductor supply shortage
- Europe: VW misses CO2 fleet target, ordered to pay compensation in diesel lawsuit
- China: VW Group to produce 15 new energy vehicle (NEV) models locally by 2025
- USA: Integrating R&D Center and Design Center, merging Traton and Navistar
- Ghana, West Africa: Constructing a new assembly plant
- Sales Forecast by LMC Automotive: VW’s light vehicle sales expected to be 9.82 million units in 2021
Summary
In 2020, Volkswagen AG (VW Group) recorded global sales volume of 9.31 million units, down by 15.2% year-over-year (y/y), losing its top position to Toyota (9.53 million units) for the first time in five years. The VW Group’s sales in all markets, including Europe, fell due to the impact of the COVID-19 pandemic.
Based on preliminary figures of financial results for the full year 2020 released on January 22, 2021, operating profit before special items (related to diesel issues) declined by half from the previous year to approximately EUR 10 billion. The Group mentioned that, while its sales volume was down in the first half of 2020, its deliveries have regained their strength in the second half of the year supported by the recovery of the Chinese market.
In the new model launch plan, the VW Group has started the electrified vehicles offensive in 2020, releasing a number of electric vehicle (EV) and plug-in hybrid vehicle (PHV) models. The Group is also expanding its lineup of popular SUVs as well as launching and updating the sedans and wagons.
As for vehicle production, the VW Group needs to adapt output at its plants in China, North America and Europe in the first quarter of 2021 to the shortage in the supply of the semiconductors.
In Europe, although the VW Group increased sales of EVs and PHVs to fulfill CO2 fleet target in the EU in 2020, the Group narrowly missed the target and will be required to pay a fine. Regarding diesel issues, the VW Group was ordered to reimburse the vehicle’s purchase price to the buyer by the judgement in the diesel litigation in Germany. In China, the VW Group plans to invest EUR 1.5 million for electrification and start production of 15 new energy vehicles (NEVs) in the country by 2025. In the US, the VW Group will expand its R & D center in California, while in West Africa, the Group plans to build a new assembly plant in Ghana.
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| VW Group global sales | VW Group sales revenue and operating profit |
Please refer to Part 1 of this VW Group series regarding its electrification strategy, autonomous driving technology, software development and mobility services.
Related reports:
VW Group (Part 1): Investing EUR 73 billion in EV, HV and digitalization in 2021-2025 (Feb. 2021)
OEM Operations in the U.S. in 2020 (Dec. 2020)
The Impact of COVID-19 on the Automotive Industry (Nov. 2020)
Start of USMCA and Mexican automobile industry trends (Jul. 2020)
VW Group (Part 2): Investing EUR 60 billion in hybrid, electric and digital in 2020-2024 (Dec. 2019)
VW Group (Part 1): Expanding SUV lineup, accelerating NEV offensive in China (Dec. 2019)
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