Rising prices at Volkswagen. The German giant with twelve brands (Audi, Volkswagen, Seat, Skoda, Porsche …) must reduce the emissions of its vehicles to 95 grams of CO2 per kilometer in 2020. An objective that requires, in addition to electrification of its fleet, modifications on its vehicles. These measures will generate a “sharp rise in material costs,” explained Friday Christian Dahlheim, in charge of sales of the group.
However, Volkswagen explains that the competitiveness efforts will not be enough to fully offset this cost increase, which could reach up to 3,000 euros per vehicle: “sometimes significant price increases are necessary,” concluded the leader, adding that those will be proportionally more affected by the range of smaller, less expensive vehicles.
Record sales
Volkswagen recorded a new sales record in 2018. The Wolfsburg group announced Friday that it delivered 10.83 million vehicles last year, 0.9% more than the previous year. In 2017, the group whose image was tainted by the revelations about the “dieselgate” more than three years ago, had already reached a sales record .
The group of 640,000 employees explains the overall growth of its sales by launching a series of SUVs, these SUVs that have the wind in their sails. While sales of Volkswagen, the Group’s largest brand in terms of volume, grew by only 0.2% (6.24 million vehicles delivered), its other brands performed well, as did MAN trucks ( 19.6%) and Scania (+ 6.3%), and Seat brands (+ 10.5%) and Skoda (+ 4.4%).
The group overcomes the obstacles
However, the exercise proved difficult in 2018 because of the logistical difficulties caused by the entry into force in September of new European anti-pollution standards (WLTP) on new vehicles. Volkswagen did not approve all its models in time because of the “dieselgate”, which takes its engineers and test benches. He was forced to postpone some deliveries. The Audi premium brand was particularly hard hit: shipments dropped 3.5% year-on-year due to delays in the WLTP record in the fourth quarter.
Another difficulty is the weakening of the Chinese market, the largest market of the group, which has signed in 2018 its first decline for 30 years . In this context, however, Volkswagen has pulled the chestnuts from the fire, selling 4.2 million vehicles, 0.5% more over a year.
In 2019, Volkswagen is optimistic and expects a slight increase in global demand.