VW reports record 2007 results

Volkswagen Group¡¯s sales revenue grew by 3.8% to €108.9 billion, and operating profit more than trebled to around €6.2 billion last year. At €6.5 billion, the group¡¯s target of €5.1 billion profit before tax, originally planned for 2008, was substantially exceeded. With a return on investment of 9.5% in the Automotive Division ¨C following 2.1% in 2006 ¨C Volkswagen not only earned its cost of capital, but also exceeded its own minimum required rate of return of 9%, and fell not far short of its medium-term target of over 10%.
 
With around 6.2 million vehicles delivered worldwide, the VW Group beat the previous year¡¯s figure by 8% and set a new record. All eight of the Group¡¯s brands contributed to this growth. VW has now set itself the goal of selling 8m Group vehicles by 2011. To accomplish this, more than 20 entirely new models will be launched in the period up to 2010, with more exposure planned in segments such as SUVs, vans and pickups.
 
Productivity in vehicle assembly is expected to rise by around 10% a year via deployment of a continuous improvement process enshrined in the ¡°Volkswagen Way¡±.
 
The Volkswagen Group has also underscored its involvement in the commercial vehicles business by acquiring a majority voting stake in Swedish truck manufacturer Scania AB. ¡°For Scania, this is a historic step towards a clear, long-term shareholder structure. We are committed to Scania and the Scania team. Together, we will harness our market opportunities even more effectively,¡± Martin Winterkorn, the Chairman of the Board of Management said.
 
VW has subsequently indicated that it will not seek to increase its holding in MAN Nutzfahrzeuge, which last year mounted an unsuccessful hostile bid for Scania without VW¡¯s support.
 
Winterkorn also welcomed the announcement that the Supervisory Board of Porsche Automobil Holding SE has endorsed an increase in the company¡¯s shareholding in Volkswagen: ¡°We look forward to even closer cooperation soon,¡± said Winterkorn.
 
The Volkswagen Group¡¯s 2008 operating profit is expected to exceed the 2007 level, without support from economic growth rates, which are expected to be lower than those of 2007.
 
¡°The Volkswagen Group has a medium-term target for return on investment in the Automotive Division of over 10 percent. A condition for this is continued disciplined management of costs and investments."
From: auto industry.uk/news

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