NSU.F - AUDI AG

Frankfurt - Frankfurt Delayed Price. Currency in EUR
1,560.00
-10.00 (-0.64%)
At close: 5:18PM CEST
Stock chart is not supported by your current browser
Gain actionable insight from technical analysis on financial instruments, to help optimize your trading strategies
Chart Events
Neutralpattern detected
Performance Outlook
  • Short Term
    2W - 6W
  • Mid Term
    6W - 9M
  • Long Term
    9M+
Previous Close1,570.00
Open1,560.00
Bid0.00 x N/A
Ask0.00 x N/A
Day's Range1,560.00 - 1,570.00
52 Week Range772.00 - 1,600.00
Volume10
Avg. Volume4
Market Cap67.507B
Beta (5Y Monthly)0.24
PE Ratio (TTM)17.42
EPS (TTM)89.53
Earnings DateN/A
Forward Dividend & YieldN/A (N/A)
Ex-Dividend DateMay 15, 2019
1y Target EstN/A
Fair Value is the appropriate price for the shares of a company, based on its earnings and growth rate also interpreted as when P/E Ratio = Growth Rate. Estimated return represents the projected annual return you might expect after purchasing shares in the company and holding them over the default time horizon of 5 years, based on the EPS growth rate that we have projected.
Fair Value
XX.XX
N/A
Research that delivers an independent perspective, consistent methodology and actionable insight
Related Research
    View more
    • Bloomberg

      Tesla's Overexcited Fans Should Cool Down a Little

      (Bloomberg Opinion) -- Back when Tesla Inc. delivered 95,000 cars to customers during the spring quarter of 2019, the stock price was languishing at about $235 and Elon Musk’s electric car company was valued at “only” $40 billion. Fast forward a year and the shares are now priced at more than $1,200. With a market capitalization of $224 billion, Tesla has surpassed Toyota Motor Corp. as the world’s most valuable automaker.Yet in the second quarter of 2020, Tesla delivered 91,000 vehicles — about 5% fewer than the same period last year. That’s pretty underwhelming for a company whose fans view it as a fast-growing technology company in the mold of Amazon.com Inc., rather than a sluggish metal-bashing carmaker. So how is the massive recent jump in its market value justified?In fairness, it shows resilience to sell this many cars when the company’s main California plant was shut by the pandemic for much of the spring period. Doubtless, Tesla’s new Shanghai plant picked up the production slack, which suggests the expense and effort of getting that China factory up and running was worth it. The launch of Tesla’s new Model Y crossover vehicle will have helped. Ford Motor Co. and General Motors Co. both saw their U.S. deliveries decline by a third in the same quarter. Nevertheless, Tesla’s stock market acolytes pushed the shares up another 8% on Thursday, adding $16.5 billion to the market value. Such exuberance is hard to understand. Musk’s company sold 7,650 more vehicles than analysts expected during the second quarter, and the stock price jump equates to about $2 million of added shareholder value for each of those additional sales. This seems a little excessive given that a Tesla Model 3 sells for less than $40,000, and the profit margin on those cars is pretty slim.  The shareholder reaction makes even less sense when you consider that Tesla investors aren’t really meant to buying the stock because of the company’s current sales, which are less than 4% of Volkswagen AG’s. Rather, the investment case is a long-term one: that it will come to occupy a dominant position in clean transport and energy in the years ahead. That explains why the shares trade at 320 times its analyst-estimated earnings this year. Viewed through this lens, Tesla’s ability to shift a few thousand extra cars in recent weeks shouldn’t matter so much for the valuation.  Investors’ tendency to overreact to Tesla news made more sense when its survival was open to doubt. A year ago it was laying off workers, U.S. sales were slowing and its retail strategy was confused. Senior staff kept heading for the exit. The company was burning through cash and ran pretty low on financial fuel. It had just $2.2 billion of cash in March 2019, compared with more than $8 billion now.But subsequent evidence that Tesla can sell cars for more than it costs to produce them has transformed the mood — and with it Tesla’s stock price.Instead of “killing” off Tesla, the tepid electric offerings of established carmakers such as Audi and Mercedes have only underscored the quality of their rival’s battery and powertrain technology (the same can’t be said of Tesla’s build quality). Volkswagen’s software problems with its forthcoming ID.3 electric vehicle suggest catching Tesla won’t be straightforward, even with the Germans’ vast resources.Tesla’s stratospheric valuation appears to have become self-reinforcing. Should it require more money to fund its roughly $9 billion of capital expenditure over the next three years, it can raise it from shareholders without worrying about diluting them too much.Similarly, holders of more than $4 billion of convertible bonds that Tesla issued to fund its expansion should be happy to convert them into stock, rather than demand cash repayment, taking some of the pressure off the company and its balance sheet.  Still, Tesla’s valuation remains impossible to justify by any standard metrics. Analysts’ average price target is more than 40% below the current level. Even Musk has suggested that the share price, which has almost trebled since the start of 2020, is too high — although, as with his taunting of the U.S. Securities and Exchange Commission and his comments about “fascist” lockdowns, it’s usually better to tune out what Musk says and focus on his actions instead.  The skeptics might have more faith in Tesla’s new position as the leader of the automaker pack when Musk stops his provocations and his shareholders stop getting giddy over modest good news.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Chris Bryant is a Bloomberg Opinion columnist covering industrial companies. He previously worked for the Financial Times.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

    • Reuters

      Mercedes-Benz cars to be built on Nvidia autonomous driving platform from 2024

      Semiconductor maker Nvidia Corp said on Tuesday it struck a deal with Germany's Daimler Mercedes-Benz to provide cars produced from 2024 with a chip and software platform that can eventually be used for autonomous driving functions. “We intend to join forces to create a software-defined vehicle and deploy this across the entire next generation's fleet,” Nvidia Senior Director of Automotive Danny Shapiro told reporters. Shapiro declined to disclose the financial terms of the deal.

    • Reuters

      Scores of Volkswagen's Mexico staff test positive for coronavirus

      Volkswagen AG's Mexican unit on Monday said about 2% of its workers tested for coronavirus had contracted the disease at some point, underlining the challenge faced by automakers in reopening factories before the pandemic has peaked in Mexico. Volkswagen last Tuesday began sending workers in reduced numbers back to its factory in the city of Puebla, where the German automaker and its luxury brand unit Audi have major plants. Many other major carmakers, especially from the United States and Japan, had resumed operations in other parts of Mexico a couple of weeks earlier.

    • Volkswagen to Up Stake in QuantumScape, Fully Acquire Audi
      Zacks

      Volkswagen to Up Stake in QuantumScape, Fully Acquire Audi

      Volkswagen (VWAGY) is set to pump $200 million in QuantumScape to boost the development of solid-state battery technology and agrees to pay $267 million for gaining 100% ownership of the Audi brand.

    • Reuters

      MORNING BID-Green shoots but also job losses and geopolitics

      The views expressed are her own.) As if economic and pandemic troubles were not enough, the world's two most populous countries are engaged in border clashes that have killed at least 20 Indian soldiers and almost certainly some Chinese. Then nuclear-armed North Korea blew up a liaison office with the South and moved military police into the demilitarised zone. U.S. infection rates are at record highs in at least six states, too.

    • Volkswagen to pay $267 million for Audi buyout
      Reuters

      Volkswagen to pay $267 million for Audi buyout

      Volkswagen will pay a 48% premium to buy out the minority shareholders of premium division Audi, Audi said on Tuesday. Volkswagen, which already holds 99.64% of Audi, announced the squeeze-out plans in February. "Volkswagen AG announced and specified that it has set the cash settlement to be paid to the minority shareholders in return for the transfer of their shares at 1,551.53 euros per AUDI AG share," the carmaker said.

    • Mexican State Orders Audi, Volkswagen To Keep Mexican Factories Closed
      Benzinga

      Mexican State Orders Audi, Volkswagen To Keep Mexican Factories Closed

      Coronavirus concerns have prompted the Mexican state of Puebla to order VOLKSWAGEN AG/ADR (OTC: VWAPY) and its luxury brand unit Audi AG (OTC: AUDVF) to keep their plants closed for the time being.Volkswagen AG had previously said it was ready to resume operations in Puebla, Mexico, on Monday.Puebla Gov. Miguel Barbosa tweeted that he had signed a decree on Friday stating that conditions for reopening the automotive and construction sectors were not yet favorable."Today I have signed a decree determining that there are no conditions for the return of the activities of the automotive and construction industries in order to maintain confinement and measures to prevent further contagion from Covid-19," Barbosa tweeted.Barbosa added that he would not restart Puebla's economy at the expense of public safety.Around 45,000 auto workers in Puebla were expected to go back to work Monday, including 15,000 at the Volkswagen plant, 7,000 at Audi and another 15,000 who work for direct suppliers, according to the Independent Union of Volkswagen Workers (SITIAVW) in Puebla.According to VW's Mexico website, the Puebla plant is the largest automobile production facility in the country. Last year, around 443,435 cars were made at Volkswagen's Puebla plant, which produces the Jetta, Golf 7, Tiguan Long Version, as well as engines and components.The Audi plant in Puebla, which produces the Q5 compact SUV, made 156,995 vehicles in 2019.Puebla is about 75 miles southeast of Mexico City and 768 miles from the U.S.-Mexico border at Laredo, Texas.It's not clear what the continued shuttering means for VW's plant in Chattanooga, Tennessee, which relies on suppliers from VW's Puebla factories."We're working closely with suppliers to ensure we have sufficient parts available for production," VW-Chattanooga spokeswoman Amanda Plecas said in an email to FreightWaves.Volkswagen's Chattanooga plant recently reported 12 positive coronavirus tests among its employees, contractors and suppliers since resuming production on May 17."The most recent case was last in the plant on May 28," Plecas said.Plecas said when a case is confirmed, CDC protocols are followed, and all general areas that may have been exposed to the individual receive additional cleaning and disinfecting."Contact-tracing is conducted, and those meeting close-contact parameters are tested. All individuals with positive test results are placed on medical leave in quarantine for the recommended 14 days," Plecas said.Per protocol, badge access to the VW Chattanooga plant is deactivated and the individuals cannot return to the plant until given medical clearance.Click for more FreightWaves articles by NOI MAHONEY.See more from Benzinga * Building A Better Fashion Supply Chain Through Tech (With Video) * STORD Acquires Cove Logistics * West Coast Remains Tightest Region – FreightWaves NOW(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

    • Reuters

      Mexico's Puebla state says not yet ready to reopen automotive plants

      Mexico's Puebla state, home to plants by German automakers Volkswagen AG and Audi, is not ready to reopen its automotive sector due to continuing concerns about the spread of the coronavirus, Puebla's Governor Miguel Barbosa said on Friday. Barbosa signed a decree on Friday stating that the conditions for return of the automotive and construction sectors are not favourable, according to a statement published on the state's Twitter account.

    • Volkswagen Feud Threatens a $38 Billion Bet
      Bloomberg

      Volkswagen Feud Threatens a $38 Billion Bet

      (Bloomberg Opinion) -- In parts of Germany, Bavarians were once known as “needleheads.” One day, God, angered at the solipsism in the country’s beautiful southernmost state, is supposed to have picked a local up by the head, thus elongating it like a needle, and rotated it. “See,” God said, “there’s more to the world than just Bavaria.”The tale might offer a useful lesson to Volkswagen AG’s Bavarian chief executive officer, Herbert Diess, and the company’s board. Internecine conflict at the top of the world’s biggest carmaker risks derailing its 33 billion-euro ($38 billion) bet on electric vehicles at the worst possible moment, with car sales at their lowest in decades and Tesla Inc. becoming a genuine threat. Volkswagen needs to be looking outward beyond its domestic concerns, not inward.The parent company of Audi, Porsche, Lamborghini and Bentley has been buffeted these past two weeks as tension between Diess and some members of the firm’s supervisory board broke into the open. At an internal event for more than 3,000 managers last week, the former BMW AG executive accused directors of committing crimes by leaking confidential discussions, Bloomberg News reported. On Monday, the board responded by stripping him of direct control of the Volkswagen brand — he’d been CEO of both Volkswagen AG and its dominant, namesake division. Diess apologized, and the board issued a lukewarm statement, saying they would “continue to support him in his work.” The contretemps is another ugly distraction from Diess’s otherwise largely successful leadership of the German giant. Since taking the reins in 2018, he has helped the company move on from the 2015 dieselgate scandal by accelerating a pivot toward electric vehicles, and integrating more closely the company’s disparate fiefdoms of 12 brands spanning motorbikes to 16-ton trucks. The stock has outperformed German rivals BMW and Daimler AG under his leadership. While Mercedes owner Daimler has issued five profit warnings in the same period, VW has issued one, prompted by the coronavirus pandemic.Managing the conflicting interests at Volkswagen is an unenviable task. Its dual-class share structure — a rarity in corporate Germany — means the 75 billion-euro company is essentially family owned, with descendants of automotive engineer Ferdinand Porsche controlling 53% of the voting shares. The State of Lower Saxony, where Volkswagen is based, controls 20% of the votes, and powerful labor representatives have slightly less than half the board seats.It’s a stark contrast with Tesla, which suffers from the inverse problem: a lack of oversight for its brilliant but flawed CEO. While Elon Musk can unilaterally decide to build a tent to accelerate assembly of Tesla’s Model 3 sedan, Diess has to satisfy a panoply of interested parties as he tries to transform his company.But Diess, who has a history of poorly judged comments, needs to get out of his own way too. His recent accusation of boardroom criminality followed a staggeringly distasteful assertion to managers last year that “Ebit macht frei.” That translates roughly as “profit sets you free,” echoing the “Arbeit macht frei” (“work sets you free”) sign above the gates of Nazi concentration camps.Volkswagen has changed CEO twice already since 2015. It doesn’t need another upheaval. At stake is more than just the interests of the Porsche family and Lower Saxony. The carmaker employs about 670,000 people, and it’s among the biggest employers in countries such as Hungary, the Czech Republic and Portugal. Its actions have significant implications for European stability. The company’s leadership needs to get the transition to electric cars right. There’s more to the world than its corporate headquarters.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Alex Webb is a Bloomberg Opinion columnist covering Europe's technology, media and communications industries. He previously covered Apple and other technology companies for Bloomberg News in San Francisco.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

    • Reuters

      VW CEO apologised to supervisory board for "inappropriate" remarks

      Volkswagen Chief Executive Herbert Diess apologised to the company's supervisory board for having made "inappropriate and wrong" statements at an internal event, the carmaker said on Tuesday. The public acknowledgment that Diess had been forced to apologise to the 19-member board of directors amounts to a severe admonishment of Diess, who had his portfolio of responsiblities curtailed on Monday. "The members of the Supervisory Board accepted the apology of Dr. Diess, and will continue to support him in his work," the statement added.

    • A Million-Mile Battery From China Could Power Your Electric Car
      Bloomberg

      A Million-Mile Battery From China Could Power Your Electric Car

      (Bloomberg) -- The Chinese behemoth that makes electric-car batteries for Tesla Inc. and Volkswagen AG developed a power pack that lasts more than a million miles -- an industry landmark and a potential boon for automakers trying to sway drivers to their EV models.Contemporary Amperex Technology Co. Ltd. is ready to produce a battery that lasts 16 years and 2 million kilometers (1.24 million miles), Chairman Zeng Yuqun said in an interview at company headquarters in Ningde, southeastern China. Warranties on batteries currently used in electric cars cover about 150,000 miles or eight years, according to BloombergNEF.Extending that lifespan is viewed as a key advance because the pack could be reused in a second vehicle. That would lower the expense of owning an electric vehicle, a positive for an industry that’s seeking to recover sales momentum lost to the coronavirus outbreak and the slumping oil prices that made gas guzzlers more competitive.“If someone places an order, we are ready to produce,” said Zeng, 52, without disclosing if contracts for the long-distance product have been signed. It would cost about 10% more than the batteries now inside EVs, said Zeng, whose company is the world’s largest maker of the batteries.Concerns about batteries losing strength and having to be replaced after a few years is one factor holding back consumer adoption of EVs. Tesla last year flagged it expected to bring into production a battery capable of a million miles of operation, and General Motors Co. last month said it is nearing the milestone. That distance is equivalent to circling the planet 50 times.Anticipating a rapid return to growth for the EV industry, CATL is plowing research-and-development dollars into advances in battery technology. While the coronavirus outbreak will drag down sales throughout this year, EV demand will pick up in early 2021, said Zeng, who founded CATL a decade ago.Car buyers holding back during the pandemic is creating pent-up demand that will be unleashed starting next year, led by premium models, he said. CATL’s customers include BMW AG and Toyota Motor Corp.Zeng’s comments strengthen views that electric vehicles are set to weather the economic slowdown caused by the outbreak better than gas guzzlers. Battery-powered cars will swell to 8.1% of all sales next year in China, which accounts for the largest share of global EV sales, and to 5% in Europe, BNEF predicts.“The pandemic may have a lasting effect throughout 2020, but won’t be a major factor next year,” Zeng said. “We have great confidence for the long run.”CATL struck a two-year contract in February to supply batteries to Tesla, a major boon for the Chinese company as the U.S. electric-car leader has thus far mainly worked with Japan’s Panasonic Corp. and South Korea’s LG Chem Ltd. The deal followed months of negotiations, with Tesla Chief Executive Officer Elon Musk traveling to Shanghai to meet with Zeng.The CATL batteries are set to go into Model 3 sedans produced at Tesla’s massive new factory near Shanghai, which started deliveries around the beginning of this year. Batteries are the costliest part of an EV, meaning suppliers of those components have a chance to reap a lion’s share of the industry’s profits.Zeng said he often shares insights with Musk, with the two exchanging text messages about developments in technology and business. CATL is strengthening its relationship with Tesla, with matters such as cobalt-free batteries on their agenda, Zeng said.“We’re getting along well and he’s a fun guy,” Zeng said of Musk. “He’s talking about cost all day long, and I’m making sure we have the solutions.”Zeng said Musk also requested his help in obtaining ventilators for coronavirus patients. The U.S. billionaire delivered more than 1,000 of the breathing machines from China to officials in Los Angeles in March.Shares of CATL have advanced about six-fold in Shenzhen since its initial public offering in 2018, giving the company a market value of about $47 billion. Tesla, by far the most valuable EV maker, has a market capitalization of about $160 billion.A “trigger point” for electric cars will occur once they overtake gasoline-powered vehicles around 2030-2035, Zeng said. That view is more ambitious than that of researchers such as BNEF, which expects the shift to take place a few years later.CATL, which is adding a production facility in Germany, is set to make more than 70% of batteries required by BMW, an early customer, Zeng said. CATL also works with Volkswagen’s Audi unit and is cooperating with Porsche, he said.Zeng didn’t rule out building a plant in the U.S., though he said the company has no specific plans for now.“Our team has made achievements in competing with our global rivals in overseas markets,” Zeng said.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

    • Reuters

      German auto stimulus to boost VW's electric push

      Germany unveiled sweeping incentives for cheap electric cars and for hybrid vehicles, providing a boost to Volkswagen's electric push while staggered taxes for polluting combustion-engined cars will penalise sports utility vehicles. Buyer incentives for passenger cars, including a lowering of value added tax to 16% from 19% were included as part of a 130 billion euro ($145.74 billion) stimulus package to speed up Germany's recovery from the coronavirus. In addition to a staggered tax on vehicles emitting large amounts of carbon dioxide (CO2), hitting sports utility vehicles, Germany included a 6,000 euro incentive for battery electric cars costing below 40,000 euros.

    • Audi launches high-tech car unit Artemis to fast-track a 'pioneering' EV to market
      TechCrunch

      Audi launches high-tech car unit Artemis to fast-track a 'pioneering' EV to market

      Audi has created a new business unit called Artemis to bring electric vehicles equipped with highly automated driving systems and other tech to market faster — the latest bid by the German automaker to become more agile and competitive. The first project under Artemis will be to "develop a pioneering model for Audi quickly and unbureaucratically," Audi AG CEO Markus Duesmann said in a statement Friday. The unit is aiming to design and produce what Audi describes as a "highly efficient electric car" as early as 2024.

    • Costly Electric Vehicles Confront a Harsh Coronavirus Reality
      Bloomberg

      Costly Electric Vehicles Confront a Harsh Coronavirus Reality

      (Bloomberg) -- At a factory near Germany’s border with the Czech Republic, Volkswagen AG’s ambitious strategy to become the global leader in electric vehicles is coming up against the reality of manufacturing during a pandemic.The Zwickau assembly lines, which produce the soon-to-be released ID.3 electric hatchback, are the centerpiece of a plan by the world’s biggest automaker to spend 33 billion euros ($36 billion) by 2024 developing and building EVs. At the site, where an East German automaker built the diminutive Trabant during the Cold War, VW eventually wants to churn out as many as 330,000 cars annually. That would make Zwickau one of Europe’s largest electric-car factories—and help the company overtake Tesla Inc. in selling next-generation vehicles.But Covid-19 is putting VW’s and other automakers’ electric ambitions at risk. The economic crisis triggered by the pandemic has pushed the auto industry, among others, to near-collapse, emptying showrooms and shutting factories. As job losses mount, big-ticket purchases are firmly out of reach—in the U.S., where Tesla is cutting prices, more than 36 million people have filed for unemployment since mid-March. Also, the plunge in oil prices is making gasoline-powered vehicles more attractive, and some cash-strapped governments are less able to offer subsidies to promote new technologies.Even before the crisis, automakers had to contend with an extended downturn in China, the world’s biggest auto market, where about half of all passenger EVs are sold. Total auto sales in China declined the past two years amid a slowing economy, escalating trade tensions, and stricter emission regulations. EV sales are forecast to fall to 932,000 this year, down 14% from 2019, according to BloombergNEF. The drop-off is expected to stretch into a third year as China's leaders have abandoned their traditional practice of setting an annual target for economic growth, citing uncertainties. Economists surveyed by Bloomberg expect just 1.8% GDP growth this year.The global market contraction raises the prospect of casualties. French finance minister Bruno Le Maire has warned that Renault SA, an early adopter of electric cars with models like the Zoe,  could “disappear” without state aid. Even Toyota Motor Corp., a hybrid pioneer when it first introduced the Prius hatchback in 1997, is under pressure. The Japanese manufacturer expects profits to tumble to the lowest level in almost a decade.Automakers who for years have invested heavily in a shift to a high-tech future—including autonomous vehicles and other alternative energy-based forms of transportation such as hydrogen—now face a grim test. Do their pre-pandemic plans to build and sell electric cars at a profit have any chance of succeeding in a vastly changed economic climate? Even as Covid-19 has obliterated demand, for the car makers most committed to electric, there’s no turning back.“We all have a historic task to accomplish,” Thomas Ulbrich, who runs Volkswagen’s EV business, said when assembly lines restarted on April 23, “to protect the health of our employees—and at the same time get business back on track responsibly.”Volkswagen Pushes AheadGlobal EV sales will shrink this year, falling 18% to about 1.7 million units, according to BloombergNEF, although they’re likely to return to growth over the next four years, topping 6.9 million by 2024. “The general trend toward electric vehicles is set to continue, but the economic conditions of the next two to three years will be tough,” said Marcus Berret, managing director at consultancy Roland Berger.Volkswagen’s Zwickau facility became the first auto plant in Germany to resume production after a nationwide lockdown started in March. Before restarting, the company crafted a detailed list of about 100 safety measures for employees, requiring them to, among other things, wear masks and protective gear if they can’t adhere to social-distancing rules.The cautious approach has reduced capacity—50 cars per day initially rolled off the Zwickau assembly line, roughly a third of what the plant manufactured before the coronavirus crisis. (VW said Wednesday that daily output had  risen to 150 vehicles, with a plan to reach 225 next month.) Persistent software problems also have plagued development of the ID.3, one of 70 new electric models VW group is looking to bring to market in the coming years. Still, Ulbrich and VW CEO Herbert Diess over the past three months have reaffirmed Volkswagen’s commitment to electrification. “My new working week starts together with Thomas Ulbrich at the wheel of a Volkswagen ID.3 - our most important project to meet the European CO2-targets in 2020 and 2021,” Diess wrote in a post on LinkedIn in April. “We are fighting hard to keep our timeline for the launches to come.”Diess has described the ID.3 as “an electric car for the people that will move electric mobility from niche to mainstream.” Pre-Covid, the company had anticipated that 2020 would be the year it would prove its massive investments and years of planning for electric and hybrid models would start to pay off.A more pressing worry that could hamper VW’s ability to scale up production is its existing inventory of unsold vehicles. The cars need to move to make room for new releases, but sales are down as consumers are tightening their spending. One response has been to offer improved financing in Germany, including optional rate protection should buyers lose their jobs. VW also has adopted new sales strategies first used by its Chinese operations, such as delivering disinfected cars to customer homes for test drives, and expanding online commerce.Other German automakers are similarly pushing ahead with EV plans. Daimler AG is sticking to a plan to flank an electric SUV with a battery-powered van and a compact later this year. BMW AG plans to introduce the SUV-size iNEXT in 2021 as well as the i4, a sedan seeking to challenge Tesla’s best-selling Model 3.A potential obstacle for all these companies—apart from still patchy charging infrastructure in many markets—is the availability of batteries. Supply bottlenecks appear inevitable given that the number of electric car projects across the industry outstrip global battery production capacity. And boosting cell manufacturing is a complicated task.China's (Weakened) EV Dominance For VW and others, the first big test of EVs’ appeal in a Covid-19 world will come in China. Diess has referred to China as “the engine of success for Volkswagen AG.” VW group deliveries returned to growth year-on-year last month in China, while all other major markets declined.Not long ago, China appeared to be leading the world toward an electric future. As part of President Xi Jinping’s goal to make the country an industrial superpower by 2025, the government implemented policies that would boost sales of EVs and help domestic automakers become globally competitive, not just in electric passenger cars but buses, too.With the outbreak seemingly under control in much of the country, China is seeing some buyers return to the showrooms, but demand for passenger cars is likely to fall for the third year in a row, putting startups like NIO Inc.  at risk and hurting more-established players like Warren Buffett-backed BYD Co., which suffered from a 40% year-on-year vehicle sales decline in the first four months of 2020.The Chinese auto market may shrink as much as 25% this year, according to the China Association of Automobile Manufacturers, which before the pandemic had been expecting a 2% decline. EV sales fell by more than one-third in the second half of 2019.NIO, the Shanghai-based startup that raised about $1 billion from a New York Stock Exchange initial public offering in 2018 but lost more than 11 billion yuan ($1.5 billion) last year, was thrown a much-needed lifeline when a group of investors, including a local government in China’s Anhui Province, offered 7 billion yuan last month.Other Chinese manufacturers are counting on support from the government, too, including tax breaks and an extension to 2022 of subsidies, originally scheduled to end this year, to make EVs more affordable.For now, the government will also look to help makers of internal combustion engine vehicles, at least during the worst of the crisis, said Jing Yang, director of corporate research in Shanghai with Fitch Ratings. But, she said, “over the medium-to-long term, the focus will still be on the EV side.”America is Tesla CountryCompanies can’t count on that same level of support from President Donald Trump in the U.S., where consumers who love their SUVs and pickup trucks have largely steered clear of electric vehicles other than Tesla’s.The U.S. lags China and Europe in promoting the production and sale of EVs, and that gap may widen now that Americans can buy gas for less than $2 a gallon.“When you’re digging out of this crisis, you’re not going to try to do that with unprofitable and low-volume products, which are EVs,” said Kevin Tynan, a senior analyst with Bloomberg Intelligence.Weeks after announcing plans to launch EVs for each of its brands, General Motors Co. delayed the unveiling of the Cadillac Lyriq EV originally planned for April. Then on April 29, the company said it would put off the scheduled May introduction of a new Hummer EV. The models are part of CEO Mary Barra’s strategy to spend $20 billion on electrification and autonomous driving by 2025, to try to close the gap with Tesla.In another move aimed at winning over Tesla buyers, Ford Motor Co. unveiled its electric Mustang Mach-E last November at a splashy event ahead of the Los Angeles Auto Show. The highly anticipated model had been scheduled to debut this year. Ford has not officially postponed the release, but the company has said all launches will be delayed by about two months, potentially pushing the Mach-E into 2021.Elon Musk, whose cars dominate the U.S. electric market, cut prices by thousands of dollars overnight. The Model 3 is now $2,000 cheaper, starting at $37,990. The Model S and Model X each dropped $5,000.Musk engaged in a high-profile fight with California officials this month over Tesla’s factory in Fremont, California, which had been closed by shutdown orders Musk slammed as “fascist.”  In a May 11 tweet, he said the company was reopening the plant in defiance of county policy. On May 16, Tesla told employees it had received official approval.During most of the shutdown in California, the company managed to keep producing some cars thanks to better relations with local officials regulating its other factory, in Shanghai. That plant closed as the virus spread from Wuhan in late January, but the local government helped it reopen a few weeks later in early February.First Zwickau, Then the WorldThe ID.3’s new electric underpinning, dubbed MEB, is key to VW’s strategy to sell battery-powered cars on a global scale at prices that will be competitive with similar combustion-engine vehicles. Automakers typically rely on such platforms to achieve economies of scale and, ultimately, profits. MEB will be applied to purely electric vehicles across all of the company’s mass-market brands, including Skoda and Seat.VW said it spent $7 billion developing MEB after Ford last year agreed to use the technology for one of its European models. Separately, the group’s Audi and Porsche brands are built on a dedicated EV platform for luxury cars that the company says will be vital in narrowing the gap with Tesla.VW plans to escalate its electric-car push by adding two factories, near Shanghai and Shenzhen, that it says could eventually roll out 600,000 cars annually, more cars than Tesla delivered globally last year.While China is the initial goal, making a dent in Europe and the U.S. is the long-term one. Like China, Europe had been tightening emissions regulations significantly before the pandemic. New rules to reduce fleet emissions will gradually start to take effect this year, effectively forcing most manufacturers to sell plug-in hybrids and purely electric cars to avoid steep fines.Because of the mandates, Europe’s commitment to electrification isn’t going away, said Aakash Arora, a managing director with Boston Consulting Group. “In the long term, we don’t see any relaxation in regulation,” he said.For VW, this crisis wouldn’t be the first time it started a new chapter in difficult times. Diess saw an opportunity coming off the manufacturer’s years-long diesel emissions scandal that cost the company more than $33 billion to win approval for the industry’s most aggressive push into EVs. When VW unveiled the ID.3, officials compared its historic role to the iconic Beetle and the Golf, not knowing that this might hold in unintended ways: The Beetle arose from the ashes of World War II, and the Golf was greeted by the oil-price shock in the 1970s.“We have a clear commitment to become CO2 neutral by 2050,” VW strategy chief Michael Jost said, “and there is no alternative to our electric-car strategy to achieve this.”(Updates with Tesla price cut starting in the third paragraph. An earlier version corrected the spelling of Berret in the ninth paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

    • Reuters

      Mexico's auto industry restart gathers steam, Ford still waiting

      Mexico's auto industry reopening picked up pace on Tuesday, with Fiat Chrysler and BMW AG joining peers in gradually dusting off operations even as the wait for approvals slowed the return of Ford Motor Co and other companies. Fiat Chrysler on Tuesday began reopening two facilities in the central Mexican city of Toluca after a gradual restart of its operations in the northern city of Saltillo a day earlier, said a company spokesman. The announcement means two of Detroit's Big Three automakers have begun restarting Mexican operations.

    • Reuters

      Toyota, Nissan and Honda gear up for Mexico reboot after COVID-19 lockdowns

      Japanese automakers Toyota, Nissan and Honda said they are gradually restarting in Mexico as the nation's automotive industry reboots in line with a broader economic reopening, despite still-high numbers of new coronavirus cases. Mexican officials in mid-May said the automotive industry could exit the coronavirus lockdown before June 1 if approved safety measures were in place. Toyota Motor Corp and Nissan Motor Co Ltd told Reuters on Monday that they were preparing to gradually resume operations, and Honda Motor Co Ltd last Friday said it had begun a gradual return to operations.

    • Reuters

      Mexican auto industry groups urge Puebla state to allow operations to restart

      Mexican auto industry groups on Sunday urged the governor of the state of Puebla to allow a gradual restart of operations after economic activity was curbed to contain the spread of the novel coronavirus. Puebla, where Volkswagen and its luxury brand unit Audi have major plants, said on Friday conditions "do not exist" yet for the auto industry to restart activity, while carmakers with plants in other states have signalled they are being allowed to reopen. Mexico has 68,620 confirmed coronavirus infections, 2,082 of which were registered in Puebla.

    • Reuters

      Mexico's Puebla state says restart of auto industry not yet possible

      The government of Mexico's Puebla state said on Friday that "conditions do not exist" to re-start activities in the automotive and construction industries, given the need to mitigate the spread of the coronavirus. German automakers Volkswagen AG and Audi both have major plants in the state, but they have idled production to the coronavirus pandemic.

    • Reuters

      VW CEO calls for economic stimulus to revive auto industry -TV

      Volkswagen's chief executive called for a broad stimulus package to revive the auto industry and the economy even as he defended the carmaker's intention to pay a dividend. Diess reiterated the carmaker's intention to pay a dividend for 2019 but said the company would consider cutting bonuses and shrinking the dividend if the carmaker ended up taking state aid.

    • Reuters

      European carmakers restart production as coronavirus lockdowns ease

      Volkswagen will restart production at its Wolfsburg factory in Germany on Monday, the latest of a fleet of European carmakers to take advantage of eased coronavirus lockdown rules to resume manufacturing. VW, the world's largest car manufacturer, is celebrating the reopening of its biggest plant, in Wolfsburg, by projecting a cartoon of a VW logo squashing coronaviruses. Encouraged by a fall in infection rates, Germany has allowed small retail stores to reopen, provided they adhere to strict distancing and hygiene rules.

    • Audi's Hungarian plant to halt production on Monday
      Reuters

      Audi's Hungarian plant to halt production on Monday

      Volkswagen Group's <VOWG_p.DE> Audi brand will halt output at its plant in Hungary on Monday, the factory said, after Volkswagen announced a suspension of production at plants in Italy, Portugal, Slovakia and Spain. "In light of the clearly worse sales prospects and the uncertainties emerging in component supply (due to the coronavirus pandemic), Volkswagen Group is suspending production at most of its sites," Audi's Hungarian unit said on Tuesday.

    • If You Had Bought AUDI (ETR:NSU) Stock Three Years Ago, You Could Pocket A 63% Gain Today
      Simply Wall St.

      If You Had Bought AUDI (ETR:NSU) Stock Three Years Ago, You Could Pocket A 63% Gain Today

      One simple way to benefit from the stock market is to buy an index fund. But if you choose individual stocks with...

    • BMW to Livestream Debut of New Model After Geneva Show Called Off
      Bloomberg

      BMW to Livestream Debut of New Model After Geneva Show Called Off

      (Bloomberg) -- With the annual Geneva car show canceled for the first time since the World War II era, automakers are going virtual in a bid to wow the hordes who would otherwise descend on the Swiss city to get a closer look at the latest models.BMW AG will live stream the debut of its i4 battery-car concept on Tuesday, while Mercedes-Benz’s popular E-Class sedan and Audi’s A3 sportback and all-electric E-Tron S will also be touted in digital displays.Even as manufacturers have been pulling back from auto shows in recent years, the gatherings still attract media, suppliers and aficionados eager to run their hands over the latest upholstery trend or settle in behind the wheels of new vehicles.Audi parent Volkswagen AG used last year’s Frankfurt event to unveil its ID.3 electric car, and to spread the message that the world’s largest auto manufacturer was moving on after the diesel-cheating crisis and honing its image as a leader in the transition to battery powered-cars.The Geneva showcase, which was scheduled to start this week, was called off due to the rapid spread of the coronavirus in Europe. Carmakers were forced into contingency planning, with online events emerging as a way to salvage part of their marketing efforts. Scrapping the show will cost a few million euros, PSA Chief Executive Officer Carlos Tavares said in an LCI television interview Sunday, adding that the company’s Citroen brand amplified its DS9 launch on social media.BMW was aiming to make a big splash for its i4, a car meant to help reassert the German company’s momentum in electric vehicles. The group is sticking to the same program on Tuesday, albeit with a “digital press conference” by Chief Executive Officer Oliver Zipse, who will speak from BMW’s Munich headquarters.Even before being canceled, the Geneva show -- a luxury-car expo that’s typically dominated by glitzy rides from the likes of Ferrari NV, Porsche and Mercedes’s AMG unit -- was in danger of being overshadowed by industry woes.The virus outbreak, which has depressed car sales in China and disrupted supplier lines, adds to the challenges. Trade wars and tariffs, and an economic slowdown sent sales into a tailspin last year in China, the world’s largest auto market and a key country for exports for the three big German manufacturers.‘High Risks’At home, European automakers are saddled with tough emissions rules that have forced them to speed up the expensive roll-out of new electric vehicles. Then there’s the lingering tension with the U.S. over trade policy that could bring additional tariffs.“The state of the global economy and the situation of the auto industry are marked by high risks,” Ferdinand Dudenhoeffer, a researcher at the University of St. Gallen, Switzerland, said before the auto show was called off.Analysts have started to factor in the impact from the latest shock. RBC Capital Markets expects European auto production to drop as much as 4% this year, while LMC Automotive analysts have penciled in as much as a 4.4% global decline in auto sales in a worst-case scenario. The German auto industry’s demand index plunged in February, according to the Ifo institute.Read more: German Auto Industry Bracing for Slump as Demand Dips, Ifo SaysSneak PreviewThe broader uncertainties have made it even more crucial for automakers to cut through the gloom and entice potential car buyers.Polestar, the luxury electric-car venture of Volvo Cars and its Chinese owner Geely Group, last week held a live video-conference to draw attention to its Precept concept vehicle, in what was billed as a sneak preview ahead of Geneva. The move generated media attention ahead of the formal event planned for Tuesday, when Polestar would likely have been crowded out by bigger carmakers such as BMW and Daimler.BMW’s i4, targeted for release in 2021, is built on a new platform that can underpin electric cars, hybrids or combustion vehicles. The flexible architecture will be used to make a battery version of the popular X3 SUV this year, as well as the futuristic iNext. It gives BMW a weapon to fight back against Tesla Inc. after the U.S. upstart ate into its market share.Lost AllureAudi’s E-tron S similarly is aimed at scaling up the VW premium unit’s Tesla-fighting capabilities as Elon Musk prepares to open a gigafactory near Berlin. The Mercedes-Benz E-Class is a critical model for the carmaker in terms of global sales volumes and revenue per vehicle.Manufacturers scouring their books for ways to cut costs and better target marketing had already scaled back spending on Geneva and other industry events, which have subsequently lost some of their allure.This year at Geneva, for example, VW had done away with hosting an evening reception it traditionally used to kick off the media days preceding the opening of the trade fair to the public. This pressure is unlikely to ease anytime soon.“The current economic weakness in important markets amplifies the cost pressure and the trend toward consolidation,” said Stefan Bratzel, a researcher at the Center of Automotive Management near Cologne, Germany.(Adds comment from PSA CEO in fifth paragraph.)To contact the reporters on this story: Christoph Rauwald in Frankfurt at crauwald@bloomberg.net;Oliver Sachgau in Munich at osachgau@bloomberg.netTo contact the editors responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net, Tara Patel, Andrew NoëlFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

    • VW proposes 35% dividend increase, settles class action emissions lawsuit
      Autoblog

      VW proposes 35% dividend increase, settles class action emissions lawsuit

      FRANKFURT/HAMBURG — Volkswagen Group said its full-year operating profit rose 22% to 16.9 billion euros ($18.5 billion) thanks to strong sales of higher-margin cars and lower diesel charges, defying an industry downturn that has cut the earnings of rivals. Volkswagen is in the midst of ramping up sales of sports utility vehicles, which command better profits than ordinary cars, to 40% of passenger car sales from below 25% in 2018, while diesel related fines and settlements fell to $2.54 billion, down from $3.53 billion a year earlier. Its strong performance led the car and truck making group to propose a dividend hike to 6.50 euros ($7.18) per ordinary share, up from 4.80 euros ($5.30) and 6.56 euros ($7.24) per preferred share, up from 4.86 euros ($5.37) in 2018.

    • VW offers to buy out minority shareholders in Audi
      Reuters

      VW offers to buy out minority shareholders in Audi

      Volkswagen <VOWG_p.DE> said on Friday it had offered to buy out minority shareholders in its premium brand Audi AG <NSUG.DE>, via a so-called squeeze-out offer. Volkswagen AG already holds 99.64% of the registered share capital of Audi AG. "In the context of reorganizing competencies and responsibilities, Volkswagen AG plans to carry out a squeeze-out according to German stock corporation law in order to acquire the 0.36 percent of Audi's shares," VW said.