Report by Banco Sabadell
The German car manufacturer has announced the main thrusts of its strategic realignment plan for 2030, which it has named “Future Plan”; we highlight the following points:
▪ A commercial reorientation towards products with greater strategic importance, which will involve a 75 per cent reduction in vehicle variants.
▪ A reduction in production capacity to 9 million vehicles per year (compared to 12 million before the Covid-19 pandemic, from which they have already reduced capacity by 2 million).
▪ Cost reduction and increased competitiveness. The press release also states that the ultimate goal is for Volkswagen to be “the world’s most attractive car company” by 2030.
This is positive news if it ultimately translates into concrete measures that enable the company to bring its costs into line with the current reality of the sector. However, the fact that there are no specific figures regarding workforce adjustments (there had been rumours of cuts of up to 100,000 employees, representing a 15 per cent reduction in its workforce), coupled with the absence of specific targets by brand and/or division, leads us to believe that this is still a bare-bones agreement that will need to be fleshed out further (and which therefore risks being watered down). In any case, what we do expect to see are significant balance sheet adjustments over the next two years via ‘one-offs’, which would add volatility to margins.
