Volkswagen To Bank On EVs For Future Growth

Mobility Outlook Bureau
16 Mar 2023
11:33 AM
2 Min Read

In 2022, the group increased global sales of all-electric vehicles by 23.6% year-on-year to around 330,000 units. Additionally, it will launch ten new BEV models by 2026.


“In the past year, we successfully steered Volkswagen through difficult operational waters while at the same time doing our homework at strategic level,' Thomas Schafer, CEO, Volkswagen, has said. 

Presenting the company’s 2022 financial statements, Schefer said, the company is well positioned for the decade of transformation and 'we are implementing our strategy swiftly and consistently.”  

A press release from Volkswagen noted that the group generated annual sales of €74 billion because of an optimised model and pricing policy. Additionally, the brand also strengthened its financial base, improving “clean” net cash flow in 2022 to €1.9 billion. The group noted that optimising fixed costs and distribution expenses contributed to the good financial result.

The Volkswagen Passenger Cars brand delivered 4.6 million vehicles worldwide in 2022, down by 6.8% compared to the last calendar. Given the difficult supply situation, unit sales fell slightly in the past fiscal year to 2.2 million vehicles from 2.3 million in the previous year. The difference between deliveries and unit sales is mainly because carmaking joint ventures in China are not included in the Volkswagen Passenger Cars brand, the release added.

Interestingly, in 2022, the company increased global sales of all-electric vehicles by 23.6% year-on-year to around 330,000 units. Additionally, the group will launch ten new BEV models by 2026, including the second-generation ID.31 and the sporty ID.3 GTX1, the long-wheelbase ID. Buzz1 and the flagship ID.71. With the ID. 2all2 study in the compact car segment.

By 2030, up to eight out of ten cars sold in Europe will be battery electric vehicles (BEVs), and the share to grow likewise in North America, with a target of 55% by 2030.

At the same time, the transformation in production at Volkswagen is progressing apace. To be fully converted to electric vehicles this summer, the Emden plant in Germany will produce the ID.71 in addition to the ID.43. Starting this fall, the new-generation ID.31 will also roll off the assembly line at Wolfsburg. The company is investing around €460 million in transforming its main plant by early 2025.

On the other hand, other products with efficient internal combustion engines will also be launched in 2023 in line with customer demand in the individual regions, including the new versions of the Atlas (in North America), the Virtus in Brazil, the Tiguan and the Passat.

The company noted that demand remains strong for e-cars and internal combustion models. Across all powertrains, the order backlog for Europe alone currently exceeds 660,000 vehicles, including almost 100,000 all-electric ID.s. The priority is now on quickly producing and delivering the vehicles ordered to customers.

Patrik Andreas Mayer, CFO, Volkswagen, said, “The past fiscal year was marked by enormous geopolitical uncertainties, the sharp rise in commodity and energy prices, disrupted supply chains as well as the negative impact of the pandemic in China. Our measures to reduce costs and increase profit had an impact, leading to a robust result given this challenging environment.” The ongoing positive trend in North and South America bolstered the brand’s annual results, he added.

Volkswagen sees major growth potential in these and other regions. The market share in North America and the USA is to be doubled to at least 5% by 2030. To this end, Volkswagen plans to invest around €5 billion in e-mobility and digitalisation by 2027. A further €1 billion will be invested in South America by 2026 to additionally boost the company’s market share and kick-start the transformation to e-mobility. Initial market tests with ID. models in South America are already underway.

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