Volkswagen Group operating result increases and recovery in China accelerates

  • Operating result before special items Q1-Q3 of EUR 17.5bn reflecting an operating margin of 8.6%     
  • Volkswagen Group confirms margin guidance of 7-8.5% at the upper end of the range          
  • Overall Q3 revenues up year-on-year from EUR 56.9 bn to 70.7 bn vs a supply constrained Q3 2021 
  • Q3 operating result up year-on-year to EUR 4.3 bn. Q3 margin of 6% burdened by non-recurring items of EUR 1.6bn         
  • Accelerating recovery in China, with 27% increase in deliveries in Q3          
  • BEV ramp-up progressing, with 22% more deliveries in Q3 and accelerating BEV share of 6.8%; start of production of the ID.4 in the US          
  • Successful IPO of Porsche, with proceeds being used to accelerate the transformation and return to shareholders via special dividend          
  • Oliver Blume, Volkswagen CEO: “In the third quarter, Volkswagen made some significant strides towards generating greater sustainable value creation for shareholders. I’m pleased to see that we made progress in China and the U.S., and took another step toward further securing the supply of raw materials to deliver on our ambitious EV ramp-up plans.” 
  • Arno Antlitz, Volkswagen CFO and COO: “We have once again demonstrated Volkswagen’s financial resilience in a challenging environment. This quarter was another step towards meeting our ambitious full year targets.”

Volkswagen Group posted solid financial results in the third quarter in a difficult global environment. Total vehicle deliveries to customers were up in Q3, with overall operating result increasing from EUR 2.6bn in a supply-constricted Q3 2021 to EUR 4.3bn. The Group’s financial performance in Q3 demonstrates how measures to strengthen supply chains have successfully helped to mitigate a challenging global landscape.

The results were driven by strong profitability, in particular across the Premium and Sport & Luxury segments as well as Financial Services. The Premium brand group achieved a 14,1% margin and Sport & Luxury a 19,4% margin, underlining the Group’s continued pricing discipline and good cost progress. However, overall the operating result was weighed down by non-recurring costs totaling around EUR 1.6bn related to revaluation effects due to the Group’s suspended activities in Russia and costs associated with the Porsche IPO. Furthermore, Volkswagen is focusing its development activities for autonomous and highly automated driving. Subsequently, the financial result was burdened by a EUR 1.9bn non-cash impairment charge following the Group’s withdrawal from its investment in Argo AI.

Oliver Blume, CEO Volkswagen Group, said: “In the third quarter, Volkswagen made some significant strides towards generating greater sustainable value for shareholders. The successful Porsche IPO has demonstrated the continued strength of our brands and the opportunity of realising their full potential. With regard to the 10 points of my strategic agenda, I’m pleased to see that we made progress in two key areas already, China and the U.S. In China we teamed up with Horizon Robotics, and in the U.S. we started production of the ID.4. Also, we took another step towards securing the supply of cathode materials needed for our ambitious EV ramp-up plans by launching a joint venture with Umicore. It has been a great team effort which will need to continue to take our Group to the next level.”

Arno Antlitz, CFO Volkswagen Group, said: “This quarter has once again demonstrated Volkswagen’s financial resilience in a challenging environment was another step towards meeting our full year targets. Results were driven by especially strong performances from our Premium and Sport & Luxury brands as well as Financial Services.”

BEV ramp-up

Volkswagen Group continued to make progress in its BEV ramp-up. All-electric vehicles reached a 6.8% share of total deliveries in Q3, sequentially increasing over the year, with China remaining the biggest driver in BEV deliveries. In the year to date, 366,400 BEVs have been handed over to customers globally, 25% up from 293,000 in the prior-year period. Due to strong demand and ongoing supply constraints, the Group’s BEV order bank in Western Europe remains at a high level of over 350,000 vehicles.

Recovery in China and strengthened competitiveness

The Group’s recovery in China continues to accelerate with a 26% increase in deliveries in Q3, and a 33% increase in deliveries in September. In particular, demand for BEV vehicles in the region continues to grow and deliveries more than doubled in the year-to-date to 112,700 units (Q1-Q3 2021: 47,100). The Group is thus well on its way to doubling deliveries of all-electric vehicles in China, its largest market, even compared with the previous year as a whole.

To speed-up the pace of innovation and strengthen its customer focus in this important market, Volkswagen’s software unit Cariad entered a new partnership with Horizon Robotics, one of the leading providers of computing solutions for smart vehicles in China. The Joint Venture is expected to accelerate the regional development of Advanced Driver Assistance System (ADAS) and Autonomous Driving (AD) systems for the Chinese market.

A new chapter for Volkswagen in North America

Volkswagen Group’s expansion in the US market continued in Q3, with the first ID.4s rolling off the production line in Chattanooga, which now employs over 4,500 people to meet customer demand for the ID.4 and Atlas SUV family. The ID.4 is the first of Volkswagen’s electric vehicles to be manufactured in the US and one project of a larger $7.1bn investment into North America to boost the Group’s product portfolio, regional R&D and manufacturing capabilities. The Group aims for 55% of U.S. sales to be fully electric by 2030.

Further secured future BEV production

To further secure cathode material for future BEV production, PowerCo, the new battery company of the Volkswagen Group, announced a joint venture in Q3 with Umicore, the Belgian circular materials technology group for precursor and cathode material production in Europe. From 2025, the joint venture will supply PowerCo’s European battery cell factories with key materials for the production of BEV vehicles. By the end of the decade, the joint venture aims to produce enough cathode material annually to power 2.2 million full electric vehicles.

Successful Porsche IPO

With the IPO of Porsche AG, Volkswagen has taken the next step in its transformation from a brand manufacturer to a vertically integrated mobility group. The proceeds from the IPO give Volkswagen additional flexibility to implement its electric strategy and are an important lever to create sustainable value for shareholders over the long-term.

Arno Antlitz, CFO Volkswagen Group, said: “An important milestone in the quarter was the successful Porsche IPO, one of the largest IPOs ever carried out in Europe. The Group’s robust net liquidity position combined with the proceeds from the IPO will enable us to take further important steps toward electrification. The funds of more than EUR 9 bn will play a vital role in financing and accelerating the transformation, in particular by supporting the development of our own battery business within PowerCo.”

“We expect the safe and efficient supply of batteries to be a key differentiator in our industry. PowerCo will be a decisive competitive advantage in the future and will make a significant positive contribution to our business”, said Antlitz.

Volkswagen is pleased to let our shareholders participate directly in this successful transaction with the distribution of a special dividend of EUR 19.06 per share. To this end, we have called an Extraordinary General Meeting for December 16, 2022. The payout is then expected to take place at January 9, 2023.


Volkswagen confirms the outlook from July 28, 2022, in most material aspects.

However, deliveries are now expected to be similar to prior year level due to continued supply chain constraints.

The Volkswagen Group’s sales revenue in 2022 is expected to be 8% to 13% higher than in the previous year, and that of the Passenger Cars Division 5% to 10% higher. In terms of operating margin the Group continues to expect to come in at the upper end of the corridor of 7 to 8,5%. Reported net cash flow is expected to remain at the same level as in 2021. In 2022, net liquidity in the Automotive Division is further anticipated to be up to 15% higher than the prior-year figure, before Porsche IPO proceeds.

As a result of the structural undersupply of semiconductors, the 2022 financial year will continue to be burdened by supply bottlenecks. We expect the supply of semiconductors to improve further in the fourth quarter. Disruptions in logistics could have an additional negative impact.

Challenges arise in particular from the economic environment, increasing competitive intensity, volatile raw material and foreign exchange markets, securing supply chains, and stricter emissions-related requirements.

Key Figures

Q3Q1 –3
Volume Data1 in thousands
Deliveries to customers (units)2,1811,973+10.66,0566,951–12.9
Vehicle sales (units)2,2361,805+23.96,2436,466–3.4
Production (units)2,2371,586+41.16,3976,098+4.9
Employees (on Sept. 30, 2022/Dec. 31, 2021)674.9672.8+0.3
Financial Data (IFRSs), € million
Sales revenue70,71256,931+24.2202,997186,599+8.8
Operating result before special items4,2692,798+52.617,45714,157+23.3
Operating return on sales before special items (%)
Special items–203x–360–203+77.3
Operating result4,2692,595+64.517,09713,953+22.5
Operating return on sales (%)
Earnings before tax2,9363,079–4.716,97014,232+19.2
Return on sales before tax (%)
Earnings after tax2,1332,903–26.512,77111,357+12.4
Automotive Division2
Total research and development costs4,5383,665+23.813,82611,401+21.3
R&D ratio (%)
Cash flows from operating activities8,6523,615x22,25622,703–2.0
Cash flows from investing activities attributable to operating activities35,3696,586–18.516,67915,483+7.7
of which: capex3,0892,114+46.17,1775,891+21.8
capex/sales revenue (%)
Net cash flow3,284–2,971x5,5767,220–22.8
Net liquidity at Sept. 3031,55325,642+23.1

1Volume data including the unconsolidated Chinese joint ventures. These companies are accounted for using the equity method. Prior-year deliveries have been updated to reflect subsequent statistical trends.
Including allocation of consolidation adjustments between the Automotive and Financial Services divisions.
3Excluding acquisition and disposal of equity investments: Q3 €5,356 (3,670) million, Q1–Q3 €14,050 (11,029) million.

Key figures by brand and business field from January 1 to September 30

Vehicle salesSales revenueOperating result
Thousand vehicles/€ million202220212022202120222021
Volume brand group2,9573,17181,35674,8763,7202,478
Volks­wagen Passenger Cars1,8822,08852,02649,0552,4621,211
Volks­wagen Commercial Vehicles2372467,9567,27635655
Tech. Components12,65512,803–7382
Audi (Premium brand group)176680644,56142,3256,2824,169
Porsche Automotive (Sport & Luxury brand group)222120924,45620,9794,7463,356
TRATON Commercial Vehicles321819627,96421,305954476
Equity-accounted companies in China42,3392,156
MAN Energy Solutions2,5172,338210123
Volks­wagen Financial Services32,85932,0444,3993,688
Volks­wagen Group before special items17,45714,157
Special items–360–203
Volks­wagen Group6,2436,466202,997186,59917,09713,953
Automotive Division66,2436,466168,183152,86912,9079,986
of which: Passenger Cars Business Area6,0256,269137,702129,22611,7449,534
Commercial Vehicles Business Area21819627,96421,305956453
Power Engineering Business Area2,5172,338207–1
Financial Services Division34,81433,7304,1903,967

1The previous year’s figures were calculated by means of the simple addition of the figures for Bentley.
2Porsche (including Financial Services): sales revenue €26,741 (23,115) million, operating result €5,048 (3,559) million.
3Includes Navistar as of July 1, 2021.
4The sales revenue and operating result of the equity-accounted companies in China are not included in the consolidated figures; the share of the operating result generated by these companies amounted to €2,558 (1,962) million.
5In the operating result, mainly intragroup items recognized in profit or loss, in particular from the elimination of intercompany profits; the figure includes depreciation and amortization of identifiable assets as part of purchase price allocation, as well as companies not allocated to the brands.
6Including allocation of consolidation adjustments between the Automotive and Financial Services divisions.

Source: Volkswagen

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