Thursday, October 28, 2021
Affected customers in China
VW loses profit due to lack of chips
The chip crisis is also affecting Volkswagen – the carmaker’s operating profit drops noticeably in the third quarter. The decline is surprisingly clear. Business in China has been particularly hard hit by the crisis. On the stock exchange, the share loses.
Volkswagen is facing a setback in the midst of the transformation and is lowering its sales expectations for the current year. Due to the ongoing lack of chips, the operating result before special items fell in the third quarter by twelve percent to around 2.8 billion euros. Analysts had expected a smaller decline.
In the Volume brand group, which also includes the VW core brand and the Skoda and Seat brands, the group even recorded an operating loss. Business in China was hit above average: In the People’s Republic “the high customer demand could not be met due to a lack of semiconductors,” explained the company. On the Frankfurt stock exchange, VW shares lost almost three percent at the start.
In the first nine months of the year as a whole, VW was able to deliver almost seven percent more vehicles to customers than in the same period last year – a total of 7 million vehicles. According to the information, sales even rose by 20 percent to 187 billion euros. The operating profit from January to the end of September was 14.2 billion euros “still at a solid level” and above the same period in the previous year, as Volkswagen explained. The automaker therefore confirmed its outlook for the return for the year as a whole. Europe’s largest automaker did relatively well with its quarterly balance sheet. The US rivals Ford and GM had suffered a significantly larger drop in profits.
CEO Herbert Diess demanded that the transformation towards climate-neutral, digital mobility should not slacken: “The results of the third quarter show once again that we now have to consistently push ahead with improving productivity in the volume sector. We are determined to maintain our strong position to assert established and new competitors. “
Unrest in the main plant in Wolfsburg
In the past few months, Volkswagen had to repeatedly stop the production line and temporarily send employees home due to missing parts. According to the works council, many employees at the main plant in Wolfsburg are insecure and fear about their jobs. During short-time work, the usual surcharges on which many people in the region rely are no longer applicable.
In addition to material bottlenecks, which experts believe will drag on until next year, the main plant will have to cope with the transformation. Wolfsburg is one of the few VW plants that has not yet been awarded a contract to build a high-volume electric car that could ensure sufficient capacity utilization. Statements by CEO Diess, who sees up to 30,000 jobs in Germany at risk if the conversion of Volkswagen into a leading manufacturer of e-cars and software-based services that he is pushing for, did not succeed, had recently caused additional unrest.