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Volkswagen Concentrating on Quality Growth for Fiscal Year- 2015


The Volkswagen Group stuck to its qualitative growth path in fiscal year 2014, despite weakness in some growth markets, volatile exchange rates and an uncertain global economy. “We ensured that 2014 was another successful year. Since 2007, we have written an impressive, sustained success story. The Volkswagen Group signifies real value and reliability in a world full of uncertainties”, said Prof. Dr. Martin Winterkorn, Chairman of the Board of Management of Volkswagen Aktiengesellschaft, on thursday during the presentation of the Company’s 2014 financial results in Berlin. Winterkorn announced that the Group aims to grow further this year as well: “We want to get better in every respect in 2015 and take the next step towards the top.”

Volkswagen Group or Volkswagen Aktiengesellschaft and its subsidiaries, is a German multinational automotive manufacturing company headquartered in Wolfsburg, Lower Saxony, Germany. It designs, manufactures and distributes passenger and commercial vehicles, motorcycles, engines, and turbo machinery and offers related services including financing, leasing and fleet management.

It is divided into two primary divisions, the Automotive Division and the Financial Services Division, and has approximately 340 subsidiary companies. The company has operations in approximately 150 countries and operates 100 production facilities across 27 countries. It holds a 19.9% non-controlling shareholding in Suzukiand has two major joint-ventures in China (FAW-Volkswagen and Shanghai Volkswagen).

The idea of Volkswagen is that to establish twelve brands with an individual identity and a common goal mobility: For everyone, all over the world. Volkswagen twelve brands are follows:

Twelve Brands of Volkswagen

Volkswagen group is trying to leverage its strength of innovation necessary liquidity and financial robustness. At EUR 11.5 billion, Volkswagen expended more research and development than any other company in the world in 2014.


Production and sales (units)

Efficiency Programs:
Programs implemented to excel in the automobile industry, features include:
  1. To adopt to the radical industry changes happening around the globe.
  2. Program is not only preparing the Group for the technological challenges of the automotive world of tomorrow. Above all, it is also laying the foundations for long-term economic success, and for future generations at Volkswagen.
  3. “Future Tracks” is the compass for sustainable and profitable, in short, for qualitative growth”.

The Volkswagen Passenger Cars brand generated sales revenue of EUR 99.8 billion (EUR 99.4 billion) in 2014, up 0.4 percent on the prior-year figure. Operating profit for the Volkswagen Passenger Cars brand was negatively impacted by lower unit sales figures in the declining South American markets, the weaker demand in Russia due to the crisis, the deterioration in exchange rates – particularly in the first half of the year – and higher upfront investments in new technologies. The brand’s operating profit was down EUR 417 million year-on-year, at EUR 2.5 billion (EUR 2.9 billion). The operating return on sales was 2.5 percent (2.9 percent). The positive developments in sales and earnings of the Chinese joint ventures are not included in these figures.

The Group’s delivery figures also include the vehicles sold by its Chinese joint ventures. Volkswagen sold 3.7 million units in China last year; this was a 12.4 percent increase year- on-year. By contrast, the Group’s sales revenue and operating profit do not include the Chinese joint ventures. Their businesses have always been accounted for in the financial result using the equity method and are therefore not included in consolidated operating profit. Their proportionate share of operating profit rose by over 20 percent to approximately EUR 5.2 billion (EUR 4.3 billion) in 2014. As a Group, Volkswagen’s theoretical operating profit, including the proportionate share of the operating profit of the Chinese joint ventures, would be almost EUR 18 billion.

Deliveries grew by 4.2 percent last year to over 10.1 million vehicles (9.7 million). The Volkswagen Group’s sales revenue increased by 2.8 percent to EUR 202.5 billion in fiscal year 2014 (previous year: EUR 197.0 billion). The Group’s operating profit rose by EUR 1 billion to a record EUR 12.7 billion (EUR 11.7 billion).

Volkswagen Financial Services generated an operating profit of EUR 1.7 billion (EUR 1.6 billion) in 2014. The division signed 4.9 million new financing, leasing and service/insurance contracts worldwide (up 15.6 percent).

GOAL FOR 2015:
               “Our stated goal for fiscal year 2015 is to achieve further growth both in terms of volumes and in the Group’s sales revenue and operating profit.”  The Volkswagen Group made a promising start to 2015. In the first two months, 1.5 million passenger cars and light commercial vehicles as well as trucks and buses were delivered worldwide. This corresponds to a year-on-year increase of 1.6 percent. “We expect deliveries to increase moderately in full-year 2015 despite the persistently challenging market environment”, said CEO Winterkorn, referring to the forthcoming product initiative. 

Note : 1 euro = 66.09 rs.( current rate in market).
Reference: www.volkswagen-media-services.com,www.volkswagenag.com/ir, Annual report 2014 Volkswagen group.  

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