Volkswagen Group Interim Report January – September 2024
On October 30, 2024 the Volkswagen Group published the results for the third quarter 2024.
Wolfsburg. The Volkswagen Group expects deliveries to customers to be around 9 million vehicles (2023: 9.24 million vehicles). The company expects Group sales revenue to be around 320 billion euros (2023: 322.3 billion euros).
“Our nine-month results reflect a challenging market environment and underline the importance of delivering on the performance programs we have launched across the Group. Volkswagen Brand reported an operating margin of only two percent after nine months. This highlights the urgent need for significant cost reductions and efficiency gains. Our product momentum gives us confidence. A significantly improved order intake in Western Europe in Q3 year-on-year is testament to our strengthened product line-up, from combustion engine cars to hybrids and full-electric vehicles and provides tailwind for the final quarter.”
Key Figures
Group sales revenue up slightly year-on-year due to volume-related increases in the Financial Services business. Sales revenue in the automotive business was 1% below the prior-year level due to lower volumes.
Operating Result impacted by Brand Group Core performance and significant restructuring expenses of EUR 2.2 billion, mainly at Brand Group Core and Brand Group Progressive as well as higher fixed costs and expenses for the introduction of new products; underlying Operating Margin at 6.5%.
9M 2024 Net Cash Flow down 34% over last year period; solid Q3 2024 Net Cash Flow supported by release of working capital.
Vehicle sales growth in North America (+4%) and South America (+16%) was offset by declines in Western Europe (-1%) and particularly in China (-12%).
New models well received by the markets, strong momentum in Q3 in Western Europe with 27% more orders y-o-y.
Outlook for 2024 as per ad hoc release from Sep 27, 2024
The Volkswagen Group expects deliveries to customers to be around 9 million vehicles (2023: 9.24 million vehicles). The company expects Group sales revenue to be around 320 billion euros (2023: 322.3 billion euros).
In terms of operating result, the company expects to achieve around 18 billion euros (corresponding to an operating return on sales of around 5.6%).
In the Automotive Division, the Group expects the net cash flow to reach around 2 billion euros. This forecast includes the assumption of cash outs for M&A activities in the amount of around 3.5 billion euros, of which approximately 2 billion euros is attributable to cash out in connection with the planned joint venture with Rivian. Net liquidityin the Automotive Division is expected to be in the range of 36 to 37 billion euros in 2024.
Further information on the brand groups
Core
Sales revenue at prior year level; Operating Margin decreased to 4.4% mainly due to higher fixed costs and restructuring expenses. Underlying Operating Margin before restructuring expenses at 5.2%.
Progressive
Strong decline in sales revenue driven by supply chain shortages; Operating Margin declines to 4.5%; Operating Margin before restructuring expenses and valuation effects at ~8%.
Sport Luxury
Strong decline in sales revenue driven by the challenging macroeconomic environment and the comprehensive renewal of the product portfolio; Operating Margin declines to 14.6% due to negative effects from lower volumes on fixed cost absorption and higher fixed costs.
TRATON Trucks
Continued strong earnings momentum despite softer demand and vehicle sales; Operating Margin came in at 9.0% supported by improved cost structure.
CARIAD
CARIAD sales revenue increases driven by stronger demand for software licenses. The Operating Result was below previous year's level due to development costs.
Group Mobility
Financial Services recorded a slight increase of contract volume; credit loss ratio remains stable and on solid level. Continued normalization of used car prices; Operating Result of EUR 2.2 billion.
Key Figures Volkswagen Group
Q3 | 9M | ||||||
2024 | 2023 | % | 2024 | 2023 | % | ||
Volume Data1 in thousands | |||||||
Deliveries to customers (units) | 2,176 | 2,343 | –7.1 | 6,524 | 6,715 | –2.8 | |
Vehicle sales (units) | 2,122 | 2,314 | –8.3 | 6,463 | 6,762 | –4.4 | |
Production (units) | 2,025 | 2,173 | –6.8 | 6,632 | 6,864 | –3.4 | |
Employees (on Sep 30, 2024/ | 684.3 | 684.0 | +0.0 | ||||
Financial Data (IFRS), € million | |||||||
Sales revenue | 78,478 | 78,845 | –0.5 | 237,279 | 235,102 | +0.9 | |
Operating result | 2,855 | 4,894 | –41.7 | 12,907 | 16,241 | –20.5 | |
Operating return on sales (%) | 3.6 | 6.2 | 5.4 | 6.9 | |||
Earnings before tax | 2,356 | 5,801 | –59.4 | 12,523 | 17,700 | –29.2 | |
Return on sales before tax (%) | 3.0 | 7.4 | 5.3 | 7.5 | |||
Earnings after tax | 1,576 | 4,347 | –63.7 | 8,917 | 12,868 | –30.7 | |
Automotive Division2 | |||||||
Cash flows from operating activities | 9,517 | 7,996 | +19.0 | 20,442 | 21,733 | –5.9 | |
Cash flows from investing activities attributable to operating activities3 | 6,111 | 5,528 | +10.5 | 17,165 | 16,795 | +2.2 | |
Net cash flow | 3,406 | 2,468 | +38.0 | 3,277 | 4,938 | –33.6 | |
Net liquidity at Sep 30/Dec. 31 | 34,416 | 40,289 | –14.6 | ||||
Investment ratio | 13.1 | 14.1 | 13.6 | 12.5 | |||
1) The figures also include the equity-accounted Chinese joint ventures. Prior-year deliveries have been updated to reflect subsequent statistical trends.
2) Including allocation of consolidation adjustments between the Automotive and Financial Services divisions.
3) Excluding acquisition and disposal of equity investments: Q3 EUR 5,966 (5,630) million, January to September EUR 16,708 (16,284) million.
Key figures by brand group and business field from January 1 to September 30
Vehicle sales | Sales revenue | Operating result | Operating margin | |||||
Thousand vehicles/€ million | 2024 | 2023 | 2024 | 2023 | 2024 | 2023 | 2024 | 2023 |
Core brand group | 3,627 | 3,575 | 101,523 | 101,060 | 4,491 | 4,985 | 4.4 | 4.9 |
Progressive brand group | 800 | 945 | 46,262 | 50,390 | 2,088 | 4,595 | 4.5 | 9.1 |
Sport Luxury brand group1 | 221 | 250 | 25,899 | 27,785 | 3,771 | 5,232 | 14.6 | 18.8 |
CARIAD | – | – | 652 | 544 | –2,058 | –1,728 | – | – |
Battery | – | – | 1 | 2 | –371 | –234 | – | – |
TRATON Commercial Vehicles | 246 | 250 | 34,266 | 33,349 | 3,097 | 2,662 | 9.0 | 8.0 |
MAN Energy Solutions | – | – | 3,136 | 2,876 | 255 | 292 | ||
Equity-accounted companies in China2 | 1,903 | 2,150 | – | – | – | – | ||
Volkswagen Group Mobility | – | – | 40,959 | 37,595 | 2,113 | 2,535 | ||
Other3 | –335 | –408 | – 15,419 | –18,499 | –479 | –2,098 | ||
Volkswagen Group | 6,463 | 6,762 | 237,279 | 235,102 | 12,907 | 16,241 | 5.4 | 6.9 |
1) Including Porsche Financial Services: sales revenue EUR 28,564 (30,132) million, operating result EUR 4,035 (5,501) million.
2) The sales revenue and operating result of the equity-accounted companies in China are not included in the consolidated figures; the share of the operating result generated by these companies amounted to EUR 1,179 (1,880) million.
3) In the operating result, mainly intragroup items recognized in profit or loss, in particular from the elimination of intercompany profits; the figure includes depreciation and amortization of identifiable assets as part of purchase price allocation, as well as companies not allocated to the brands.