Home Business Volkswagen sees sturdy rebound after ‘containing’ COVID By Reuters

Volkswagen sees sturdy rebound after ‘containing’ COVID By Reuters

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© Reuters. The emblem of German carmaker Volkswagen is seen on automobile in a showroom of a Volkswagen automobile seller in Brussels

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By Christoph Steitz and Jan Schwartz

FRANKFURT (Reuters) – Volkswagen (DE:) expects deliveries, revenues and margins to rebound strongly this 12 months because the coronavirus pandemic eases, after an nearly halving in earnings in 2020 that was nonetheless higher than the German carmaker initially anticipated.

The worldwide No.2 after Toyota by vehicles offered, Volkswagen is spending tens of billions of euros to reinvent itself as a frontrunner available in the market for electrical autos, the place Tesla (NASDAQ:) has stolen a march on established rivals.

“Final 12 months, the Volkswagen Group succeeded in containing the consequences of the pandemic on its enterprise and laying essential strategic foundations for its transformation on the identical time,” finance chief Frank Witter mentioned on Friday.

Deliveries and gross sales, which have been each hit by the pandemic in 2020, are seen up considerably this 12 months, the corporate mentioned, with out being extra particular. In 2020, gross sales fell 11.8% to 222.9 billion euros ($270.2 billion), whereas deliveries dropped 15.2%.

The working margin is seen on the higher finish of its 5.0-6.5% goal vary, Volkswagen mentioned, up from 4.3% final 12 months.

“The monetary outcomes now obtainable are much better than initially anticipated and present what our firm is able to reaching, particularly in a disaster,” Witter mentioned.

“We intend to hold over the sturdy momentum from the considerably higher second half into the present 12 months.”

Shares in Volkswagen turned optimistic on the information and rose as a lot as 2.4% to a recent 13-month excessive.

Whereas the corporate has emerged from the hit to demand attributable to the pandemic, a scarcity of essential semiconductors brought on it to regulate manufacturing by way of February, becoming a member of different carmakers world wide which have suffered related issues.

Regardless of the revenue drop, Volkswagen advisable retaining its dividend to shareholders steady for 2020 versus 2019, when it paid 4.86 euros per most popular and 4.80 per bizarre share, beating analysts’ estimate of three.35 euros for most popular shares, in accordance with Refinitiv knowledge.

($1 = 0.8260 euros)

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