VLKAF - Volkswagen AG
| Previous Close | 178.00 |
| Open | 176.95 |
| Bid | 0.00 x 0 |
| Ask | 0.00 x 0 |
| Day's Range | 174.65 - 176.95 |
| 52 Week Range | 147.95 - 188.00 |
| Volume | 527 |
| Avg. Volume | 1,192 |
| Market Cap | 87.576B |
| Beta (3Y Monthly) | 0.90 |
| PE Ratio (TTM) | 5.72 |
| EPS (TTM) | 30.51 |
| Earnings Date | N/A |
| Forward Dividend & Yield | 5.36 (3.01%) |
| Ex-Dividend Date | 2019-05-13 |
| 1y Target Est | N/A |
- Reuters
Volkswagen agrees to Australian settlement over diesel cheating
Volkswagen said on Monday it had agreed to pay up to A$127 million ($87.3 million) to settle lawsuits brought on behalf of thousands of Australian customers caught up in its global diesel emissions cheating scandal. The German automaker said it would pay about A$1,400 each to owners of affected Volkswagen, Audi and Skoda EA189 diesel vehicles who opted into the lawsuit. "This is a significant step toward fully resolving the diesel lawsuits in Australia," a Sydney-based Volkswagen spokesman said in an emailed statement.
- Reuters
BMW engine development expert Duesmann set to become Audi chief in April: report
BMW's engine development and purchasing expert, Markus Duesmann, is set to become the CEO of Volkswagen's Audi premium brand, after BMW dropped its opposition to his early departure, a German newspaper reported on Saturday. The Frankfurter Allgemeine Zeitung cited a person with knowledge of the appointment as saying Duesmann will start as Audi chief on April 1.
- Reuters
VW CEO shifts strategy from empire building to efficiency
Volkswagen has abandoned its decades-old obsession with empire building and no-expense-spared engineering to free up resources for the development and mass production of electric cars, its CEO Herbert Diess told Reuters. A global clampdown on toxic exhaust fumes has triggered a new wave of consolidation in the auto industry as carmakers look for ways to slash development costs for low-emission and self-driving technologies. While rivals such as FiatChrysler and Renault explore a $35 billion deal to bulk up, Volkswagen is taking the opposite approach: slimming down.
- Financial Times
Carmakers face electric crunch time in race to hit CO2 targets
Hours before the Frankfurt Motor Show flung open its doors to the press on Tuesday, the chief executive of Volkswagen was locked in debate with Tina Velo, a well-known environmental activist. “Demonising the car is not going to help,” Herbert Diess said during the robust hour-long exchange. The new electric cars on display, from the Porsche Taycan to the Opel Corsa-e, drew crowds — but they will also need to attract a significant number of buyers if manufacturers are to avoid punitive fines.
- Market Realist
Tesla Gets Support from Rivals: Are Bears Listening?
Volkswagen CEO Herbert Diess has shared optimistic views on Tesla (TSLA), and Volvo has heaped praise on Tesla’s energy efficiency.
- Bloomberg
Merkel Offers to Help Germany’s Carmakers With ‘Herculean Task’
(Bloomberg) -- Chancellor Angela Merkel wants to help offset the higher costs of cleaner vehicles by putting a price on carbon-dioxide emissions, potentially offering a lift to Germany’s vital auto industry as it grapples with the high-risk transition away from the combustion engine.Germany and its automakers are facing a “Herculean task,” Merkel said Thursday at a ceremony opening the Frankfurt car show to the public. While short on specifics, the German leader backed efforts to encourage consumers to buy more environmentally friendly products such as battery-powered cars fueled by renewable power.“We want to direct the behavior of people in a certain direction,” she said. “The pricing of CO2 is the right way to make clear that all innovations should follow the goal of emitting less CO2. If we do this in a long-term and accountable way, there will be the incentives to move innovation in the right direction.”Volkswagen AG, Daimler AG and BMW AG are facing tough times. Pollution concerns -- intensified by VW’s 2015 diesel-cheating scandal -- have tarnished the industry’s image and triggered massive investment in electric vehicles. Those costs had already started squeezing earnings when almost a decade of uninterrupted industry growth led by China came to a halt. The consequence is Germany’s car production slumping to the lowest level since at least 2010.The looming end of the combustion-engine era and the dramatically-increasing importance of digital technologies in cars, pose an unprecedented threat to the industry’s traditional business model. A slew of profit warnings from manufacturers like Mercedes-Benz maker Daimler to parts makers like Continental AG provided fresh evidence that times have become rough.Merkel spoke after John Krafcik, the chief executive officer of Waymo. The Alphabet Inc. unit is widely regarded as the global leader in self-driving technology and represents a risk to the country’s car brands, which are largely focused on motoring thrills. Krafcik offered a cooperative tone, even though German manufacturers are wary of allowing the Google parent access to sensitive customer data.“It’s not about competing with car companies. It’s to enable, not disrupt companies in the automotive space,” said Krafcik. “Developing self-driving technology takes a lot of time. There are no shortcuts. We can’t do this on our own.”Germany is teetering on the brink of recession, and the auto industry is pivotal to the economy’s health. Carmakers such as Volkswagen, Daimler and BMW as well as parts suppliers like Robert Bosch GmbH and Continental employ about 830,000 people in the country and support everything from machine makers to advertising agencies and cleaning services.Germany’s auto industry is trying to respond. Electric cars, such as the flashy Porsche Taycan and more affordable VW ID.3, dominated media presentations this week at the Frankfurt trade fair and more models are in the pipeline.Daimler CEO Ola Kallenius backed Merkel’s CO2 pricing plan, saying at panel discussion in Frankfurt that there are costs related to fossil-fuels and it would make sense for a global plan to help fight climate change.For the auto industry, any signs of support would be welcome. Demand for electric cars has been sluggish, and Merkel had to surrender her goal to have 1 million electric cars on German roads by 2020. Sales of hybrid and electric cars in the country last year totaled a mere 55,000 vehicles, or 1.6% of the market.In addition to boosting efficient technologies, the country needs to accelerate the roll-out of charging stations to ease consumer concerns, she said.“If one believes that climate protection is a task for mankind, and I believe it is, then we must pay this price because otherwise we will have to pay a totally different price,” Merkel said.(Adds comment from Daimler CEO in 10th paragraph)To contact the reporters on this story: Christoph Rauwald in Frankfurt at crauwald@bloomberg.net;Arne Delfs in Berlin at adelfs@bloomberg.netTo contact the editors responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net, Chris Reiter, Raymond ColittFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- Bloomberg
The Electric Cars Are Here. Now How About Selling Them
(Bloomberg) -- It only took a decade for traditional automakers to take electric cars seriously and offer more than a smattering of test-the-water models.Now comes the hard part: Getting consumers to buy them.At Frankfurt’s 2019 car show, Volkswagen AG Chief Executive Officer Herbert Diess laid it on thick, calling on governments to give up coal-fired power as he unveiled the electric ID.3 car-for-the-masses. At the Mercedes-Benz stand, where the Daimler AG brand was showing the prototype of an electric S-Class sibling, real beech trees framed massive screens displaying schools of digital fish.The message to environmentally conscious consumers: we’re with you. But a marketing blitz alone won’t wash away the deep uncertainties facing electric cars -- obstacles little changed since carmakers’ initial forays with models like the Nissan Leaf and BMW AG i3. Customers don’t like paying up for new technology they’re unsure about, and they’re worried they won’t reliably get to where they want to go.“The next big thing is not going to be about the cars, because they will come,” Carlos Tavares, president of the European Automobile Manufacturers Association and CEO of Groupe PSA, said Wednesday. “The next big thing is about affordable mobility. The next big thing is about how we make this work for the biggest number of people.”So far, electric cars have only proliferated in countries with significant sweeteners. Once they go, sales of battery models crater. Demand in China, the world’s biggest electric car market, fell 16% in August -- its second straight decline -- after the government scaled back subsidies. Carmakers can reduce prices, but then only cut into profitability that in most cases has been nonexistent.Consumers are similarly sensitive elsewhere. Demand in Denmark collapsed when the government phased out tax breaks in 2016.“We’ve been talking about EVs for years, but this year the real production cars showed up,” Max Warburton, an analyst at Sanford C. Bernstein, wrote in a note. “Should we be celebrating these cars, given the poor margins that most will have?”Across Europe, sales of new plug-in hybrids and fully-electric cars last year made up 2% of total registrations. That’s a tiny market to tussle over for the likes of VW’s ID.3, with a price point below 30,000 euros ($33,009), Tesla Inc.’s Model 3 and Mercedes’s gleaming lineup of plug-ins. Yet carmakers have little choice but to boost their offering to keep pace with regulation, or face fines.Consumer demand “can’t be mandated,” Daimler CEO Ola Kallenius said at the show. Mercedes-Benz is adding at least 10 purely battery-powered cars through 2022 at a cost of more than 10 billion euros, starting with last year’s EQC SUV, so the carmaker’s lineup can to meet stricter emission limits.A lot of factors are moving in the right direction. The ID.3’s price point and basic range of 330 kilometers (205 miles) sets the car apart from previous efforts that needed meticulous pre-planning for longer trips. At the top end, there’s now the $185,000 Porsche Taycan Turbo S, and a mid-range that’s rapidly filling out from SUVs like the Jaguar I-Pace and Audi e-tron.Patchy charging infrastructure is improving too. Ionity, a consortium of Daimler, VW, Ford Motor Co., BMW and now Hyundai Motor Co., is on track to finish building a network of 400 European fast-charging stations by next year to make long-distance travel easier.Lean YearsFor carmakers, this will mean some lean years -- at least to 2025 when battery prices are expected to come down -- during which lucrative conventional SUVs must subsidize poor returns from their electric cousins. VW will need “patience” until the ID.3 brings significant profit “joy,” Chairman Hans Dieter Poetsch said.To bridge the gap, the industry is lobbying hard for governments to step up incentives to get to the oft-cited tipping point where driving without a combustion engine becomes normal. In Germany, home to VW, Mercedes and BMW as well as world-leading suppliers like Continental AG, the government sits down next week to discuss broad climate measures. Carmakers are hoping for a bigger slice of subsidies than they got so far.The ACEA on Wednesday called on national governments to boost charging points in Europe to 2.8 million by 2030, a 20-fold increase from 2018.“We need strong support, because if we don’t do it,” simply offering electric cars won’t be enough for sales to take off, PSA’s Tavares said.\--With assistance from Richard Weiss.To contact the reporters on this story: Oliver Sachgau in Munich at osachgau@bloomberg.net;Christoph Rauwald in Frankfurt at crauwald@bloomberg.netTo contact the editors responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net, Elisabeth BehrmannFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- Market Realist
Should Tesla See Volkswagen’s ID.3 as a Threat?
Volkswagen unveiled its all-electric ID.3 at the Frankfurt auto show. The model’s name is conspicuously similar to the Tesla Model 3.
- Bloomberg
VW Warns Trade War Gloom Is Getting ‘Scary’ as Car Sales Slow
(Bloomberg) -- Terms of Trade is a daily newsletter that untangles a world embroiled in trade wars. Sign up here. Volkswagen AG and other carmakers warned that trade tensions risk dragging the global economy into a recession as the fallout starts to hit consumers.The gloom of the U.S. and China’s tit-for-tat tariffs cast a shadow over the Frankfurt Auto Show this week, where carmakers were seeking to whip up interest in critical new electric models. The geopolitical volatility adds another layer of uncertainty to an industry in the midst of a radical overhaul as the end of combustion-engine era looms.“We come now into a situation where this trade war is really influencing the mood of the customers, and it has the chance to really disrupt the world economy,” Volkswagen Chief Executive Officer Herbert Diess said in an interview with Bloomberg TV. “China is basically a healthy market, but because of the trade war, the car market is basically in a recession. So that’s a new situation. That’s scary for us.”Concerns about global trade have reached nearly 10 times the peaks seen in previous decades and could shave about 0.75 percentage points off world economic growth this year, according to data compiled by the International Monetary Fund. The auto industry is particularly exposed because of its global network of assembly plants and parts suppliers. Daimler AG, for instance, makes many of its Mercedes-Benz’s SUVs in Alabama and exports them to China and other markets.“What will happen in 2020 will very much depend on what happens with the U.S. and China in the coming weeks,” BMW AG Chief Financial Officer Nicolas Peter said in an interview with Bloomberg TV at the Frankfurt show, Germany’s premier auto exhibition. The German manufacturer assembles most of its sport utility vehicles in South Carolina.After months of talks, the tensions between the U.S. and China remain high. Ted McKinney, the top trade official in U.S. President Donald Trump’s Agriculture Department, called Chinese President Xi Jinping a “communist zealot” in the mold of Mao Zedong. After a summer of bombast and tariff escalation, the two sides have agreed to hold face-to-face working-level staff talks in the coming weeks and a ministerial meeting in Washington in early October.“Everyone is affected by the industry downturn, everyone is suffering,” Continental AG CEO Elmar Degenhart told reporters Tuesday in Frankfurt. Europe’s second-largest auto supplier plans to finalize a review of its sprawling global manufacturing network by the end of this year and doesn’t rule out factory closures or layoffs as part sweeping restructuring plans.Outside the car show, other German industry leaders voiced their concerns about trade risks. Siemens AG Chief Executive Officer Joe Kaeser urged the European Union to assert its voice in the trade conflict between the U.S. and China, saying the specter of a “decoupling” of political and economic systems would break with decades of integration and ultimately risk a global slowdown.“Europe would be well advised to avoid this bilateral decoupling, but it can only achieve this when it is heard as a third force in the world, and that’s not the case at the moment,” Kaeser told journalists in Berlin. There’s a sense that the world is reorganizing into new economic spheres, making it harder for export-oriented companies to do business and creating the risk of “having to decide between friend and foe,” said the executive, who recently returned from a trip to China with German Chancellor Angela Merkel.‘Good Sense’ BrexitOn top of the U.S.-China spat and Trump’s recurring threat to impose levies on European car imports, the industry is bracing for the potential of the U.K. crashing out of the EU without a deal in a few weeks. BMW, which owns the British-based Mini and Rolls-Royce car brands, has set up a 300 million-euro ($330 million) fund to deal with a possible hard Brexit and would reduce output at its plant in Oxford, England, by eliminating a work shift if that happens, CFO Peter said.“We’d have to increase prices, and we have to curtail production to react to such a development,” Peter said on BMW’s contingency preparations for a crash British exit. “The plans are in the drawer.”In a Bloomberg TV interview, PSA Group CEO Carlos Tavares called the prospect “not acceptable” on ethical grounds and appealed to European and British leaders to show “good sense” and avoid a no-deal Brexit.Ralf Speth, the CEO of Jaguar Land Rover, laid out the complexity of an abrupt disruption to trade flows, saying the British manufacturer needs as many 25 million parts a day to be delivered on time and requires six to eight weeks to decide on ordering components. With Prime Minister Boris Johnson insisting that the U.K. will leave the EU on Oct. 31 “do or die,” the auto industry is facing its Brexit crunch time now.“Free and fair trade is best for society. Currently we’re falling back on that,” said Speth, who unveiled a resurrected version of the Land Rover Defender offroader in Frankfurt. “It’s so critical to prepare in the very best way for alternatives. But in the end, no one really knows.For the auto industry, the trade squeeze clouds efforts to show off slick new models like the Porsche Taycan and VW ID.3 as German brands ramp up electric offerings to meet increasingly stringent environmental regulations. Demand disruptions threaten to squeeze profits needed to fund the high-risk rollout.“We hope there won’t be any recession in the mid term or long term, because it would be a self-made recession,” Diess said.(Adds comments from Jaguar Land Rover CEO in third-to-last paragraph.)\--With assistance from Matthew Miller, Benedikt Kammel and Elisabeth Behrmann.To contact the reporters on this story: Christoph Rauwald in Frankfurt at crauwald@bloomberg.net;Oliver Sachgau in Frankfurt at osachgau@bloomberg.netTo contact the editors responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net, Chris Reiter, Chad ThomasFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- Bloomberg
VW Unveils New Logo, Affordable E-Cars in Show of New Era
(Bloomberg) -- Volkswagen AG is unwrapping not just new models at the Frankfurt auto show, but a tweaked logo as the world’s biggest carmaker ushers in the electric era.Little-changed since World War II, the new VW emblem was uncovered atop its headquarters in Wolfsburg on Monday. And in Frankfurt, the manufacturer showed the VW brand’s battery-powered ID.3, the first model in an unprecedented $33 billion push to make electric vehicles for the masses.The twin steps -- both heavy with symbolism -- reflect the high stakes involved in Volkswagen’s ambitions to become the world’s electric-car leader just four years after the diesel-cheating scandal plunged it into the worst crisis in its history. The carmaker aims for the ID.3 hatchback, priced under 30,000 euros ($33,200) to become a trendsetter and take on similar status as its iconic Beetle.“This evening is a decisive moment for us,” Chief Executive Officer Herbert Diess said from the podium. The ID.3 is meant to “take the electric car from being a niche product to the mainstream, making it accessible for everyone.”VW is pulling out all the stops as it seeks to reshape its image. In Frankfurt, the gathered crowd was treated to vegan sliders with green buns and herbal concoctions garnished with thyme.Diess called for the end of coal-generated electricity, among other planet-saving measures. “How can we save the world for our children?” read a query emblazoned on an entryway wall.If things work out as planned, the ID.3’s technical underpinnings, dubbed MEB, will emerge as a new industrial standard for battery-powered cars, giving Volkswagen economies of scale that rivals would struggle to match. U.S. peer Ford Motor Co. has already agreed to use the technology for a high-volume car in Europe and is considering adding a second model. Diess sees nearly 50% of the group’s sales in Europe and China being electric in 10 years.But if consumers remain on the fence about the cars because of range, charging and cost concerns, VW could find itself stuck with sunk costs, redundant factories and excess workers.“VW’s bold electric vehicle plans scare this analyst given their huge near-term costs and uncertain demand,” Max Warburton, a London-based analyst with Sanford C. Bernstein, said in a note. Former patriarch Ferdinand Piech, who died two weeks ago, “would have argued that expensive investments in new technology tend to pay off in the very long run.”The time for VW’s effort to reinvent itself is hardly favorable. A decade of almost uninterrupted growth for the industry -- fueled mainly by China -- has come to a grinding halt. Global demand for new vehicles contracted last year, and the trade war between the U.S. and China and uncertainty over Brexit is serving up yet more challenges.“We really now come into situation where the trade situation starts to influence the mood of customers, and that could disrupt the market,” Diess said in a Bloomberg Television interview. “We hope there won’t be a recession.”VW is tapping the brakes already, even as it still generates vast amounts of cash and profits. The manufacturer has scaled back production plans by some 450,000 cars for this year and has pledged to lower output further if necessary. VW’s cut roughly equals the annual output of one its 122 factories worldwide and exceeds Tesla Inc.’s delivery target for 2019 of between 360,000 and 400,000 cars.Separately, the German giant has started to make gradual progress toward untangling its unwieldy corporate structure. It regrouped its car brands to focus on luxury cars and mass-market vehicles, and after some back-and-forth eventually completed a public listing of trucks unit Traton SE earlier this year.In May, VW announced plans to review strategic options -- including a possible sale -- for the industrial machinery units Renk AG and MAN Energy Solutions. Analysts have urged VW to consider deeper changes including an initial public offering of the high-margin Porsche brand to unlock value. The sports-car unit, which is VW group’s most profitable division, will show off its electric Taycan model at the Frankfurt show after unveiling it last week.Despite these efforts, investors are doubting VW and other carmakers’ ability to master the technological shift toward electric and self-driving cars. Diess has stressed the importance of reviving VW’s weak market value to help bolster the company’s case for acquisitions and partnerships.(Updates with price in third paragraph)\--With assistance from Matthew Miller.To contact the reporter on this story: Christoph Rauwald in Frankfurt at crauwald@bloomberg.netTo contact the editors responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net, Craig TrudellFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- TechCrunch
Volkswagen reveals its mass-market ID.3, an electric car with up to 341 miles of range
Volkswagen introduced Monday the ID.3, the first model in its new all-electric ID brand and the beginning of the automaker's ambitious plan to sell 1 million EVs annually by 2025. The ID.3 debut, which is ahead of the IAA International Motor Show in Frankfurt, is an important milestone for Volkswagen. Now, four years later, VW is starting to show more than just concept vehicles for its newly imagined electric, connected and carbon-neutral brand.
- Bloomberg
BMW & Co Are Losing Their Allure, and That’s Got Germany Worried
(Bloomberg) -- Want the lowdown on European markets? In your inbox before the open, every day. Sign up here.Germany is at a crossroads, and nowhere will that be more evident than at the Frankfurt auto show this week.Despite sleek new electric models like the Porsche Taycan, the traditional showcase of German automotive excellence risks becoming a platform for protest rather than preening, drawing attention to a generation of young consumers more likely to demonstrate against the car’s role in global warming than shop for a new VW, BMW or Mercedes-Benz.Autos have made Germany into a global manufacturing powerhouse, but pollution concerns -- intensified by Volkswagen AG’s 2015 diesel-cheating scandal -- have sullied the reputation of a product that once embodied individual freedom. More recently, trade woes and slowing economies have hit demand. The consequence is Germany’s car production slumping to the lowest level since at least 2010.“Investors have been fearful about the industry’s prospects for a number of years, and the list of things to worry about doesn’t seem to be getting shorter,” said Max Warburton, a London-based analyst with Sanford C. Bernstein. “There is a general sense that things are about to get worse.”The end of the combustion-engine era and car buyers more interested in data connectivity than horsepower threaten Germany’s spot at the top of the automotive pecking order. Signs of trouble abound. In addition to numerous profit warnings this year, Mercedes maker Daimler AG delayed a plan to expand capacity at a Hungarian factory, parts giant Continental AG has started talks to cut jobs, and automotive supplier Eisenmann filed for insolvency.The car’s fragile standing was evident in the reaction to a deadly accident in Berlin on Friday evening when a Porsche SUV crashed into a group of pedestrians. Stephan von Dassel, the mayor of the district where the incident took place, said on Twitter that “such tank-like vehicles” should be banned in the city.Germany is teetering on the brink of recession, and the auto industry is pivotal to the economy’s health. Carmakers such as Volkswagen, Daimler and BMW AG as well as parts suppliers like Robert Bosch GmbH and Continental employ about 830,000 people in the country and support everything from machine makers to advertising agencies and cleaning services. With factories from Portugal to Poland, the importance of the sector radiates across Europe as well.With emissions regulations set to tighten starting next year, concerns are mounting that companies across the country’s industrial landscape are ill-equipped to deal with the technology transition resulting from climate change and increasing levels of digitalization. IG Metall organized a demonstration in June, with more than 50,000 people rallying in Berlin, to draw attention to the risk of widespread layoffs from what Germany’s biggest industrial union calls “the transformation.”“Far too many companies stick their heads in the sand and rest on their laurels,” IG Metall Chairman Joerg Hofmann said. “If companies continue to act so defensively, they’re playing roulette with the futures of their workers.”The concern is that the future of Germany’s car towns could look something like Ruesselsheim. The home of the Opel brand, which once rivaled VW as the German leader, has faded along with the carmaker’s performance. After years of losses, it was sold in 2017 by General Motors Co. to France’s PSA Group, which is slashing the Opel’s 20,000-strong German workforce by nearly a fifth.“Everybody in Ruesselsheim is worried,” said Servet Ibrahimoglu, owner of a kebab restaurant down the street from Opel’s factory, adding that his business has dropped by a third. “Before at lunchtime, this place was full. Now there’s no one.”The auto industry’s efforts to adapt to the risks will be on display in Frankfurt, and the stakes couldn’t be higher for models like the VW ID.3. The battery-powered hatchback is the auto giant’s first effort in an aggressive push into electric cars, which will make its debut at the Germany’s premier auto exhibition.Under bright lights and blaring music, the show is a throwback to the auto industry’s glory days, but it’s fading as public interest in old-school car show wanes. Toyota, Volvo and Ferrari are among the 30 brands skipping the show. For those still there, the displays will predominantly feature traditional gas guzzlers and other cash cows. Land Rover will unveil a resurrected version of the Defender, the British brand’s iconic offroader.“Instead of presenting new mobility concepts for the future, we’ll see lots of SUVs on stands that have become few and far between,” said Ferdinand Dudenhoeffer, director of the University of Duisburg-Essen’s Center for Automotive Research. “The recession in the global auto business is forcing savings cuts for car manufacturers and suppliers, along with a rapid loss of attractiveness of the classic ‘analog’ car shows.”Make or BreakWhere German brands once tried to outdo one another with outlandish displays like indoor tracks and multistory exhibition spaces, the main drama may take place outside Frankfurt’s sprawling fairgrounds. Greenpeace and Germany’s BUND have called for a mass march on the site on Saturday, joined by groups of cyclists setting off from around Frankfurt to underscore their call for the end of the combustion engine. Organizers are expecting at least 10,000 people. “We’re in the middle of a climate crisis,” said Marion Thiemann, transport-policy expert at Greenpeace. “The biggest problem is the automobile industry.”Despite doubts from environmentalists, automakers have gotten the message that they’re facing a make-or-break moment. The industry is spending billions of euros to develop cleaner vehicles and counter the emergence of ride-sharing services like Uber Technologies Inc., which has a market value equivalent to Daimler, the inventor of the automobile.“I’m absolutely convinced that carmakers will adapt to the situation,” BMW’s labor head Manfred Schoch said during a testy panel discussion with activists in Berlin last week. “Those that don’t will go out of business.”(Adds comment from activist in third-to-last paragraph)\--With assistance from Kristie Pladson, Andrew Blackman and William Wilkes.To contact the reporters on this story: Christoph Rauwald in Frankfurt at crauwald@bloomberg.net;Carolynn Look in Frankfurt at clook4@bloomberg.net;Elisabeth Behrmann in Munich at ebehrmann1@bloomberg.netTo contact the editors responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net, Christoph Rauwald, Chris ReiterFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- Reuters
UPDATE 4-U.S. launches antitrust probe into California automaker agreement
The U.S. Justice Department is investigating whether the decision of four automakers in July to reach a voluntary agreement with California to adopt state emissions standards violated antitrust law, people briefed on the matter said on Friday. The antitrust division's chief, Makan Delrahim, sent Aug. 28 letters to the four automakers saying the government was concerned the agreement "may violate federal antitrust laws" but adding it had "reached no conclusions," according to documents seen by Reuters. The disclosure comes as the Trump administration has ramped up its opposition to automakers seeking to sidestep it on rolling back Obama era fuel-efficiency rules.
- Reuters
Turkey, Volkswagen close in on production plant deal: sources
Turkey is increasingly confident German carmaker Volkswagen will build a production plant in the country after an "extremely positive" meeting between a senior company official and President Tayyip Erdogan this week, three Turkish sources said. Reuters reported last week that the two sides had been holding talks over Turkey's vehicle tax regime to conclude the 1 billion euro ($1.1 billion) investment. The carmaker, which has also considered making the investment in Bulgaria, has not announced a final decision, but sources have said Volkswagen is positive about investing in Turkey.
- Bloomberg
Porsche Unveils Its First-Ever Electric Car
(Bloomberg) -- Porsche picked Niagara Falls, a Chinese wind farm and a solar site in Germany to unveil its first all-electric sports car, underscoring the new Taycan’s central role in turning parent Volkswagen AG into the world’s leading seller of battery-powered vehicles.After a bumpy start for sister brand Audi’s e-Tron, the Taycan, with the top Turbo S version priced at $185,000, is for the time being the flag-carrier in VW’s massive drive to unseat e-car pioneer Tesla Inc. The wraps came off Wednesday at simultaneous events in its three biggest markets, with Porsche -- known for churning out roaring sports cars -- presenting the vehicle bathed in a backdrop of sustainable-power imagery.“It’s a true Porsche,” the brand’s chief executive officer, Oliver Blume, said at the German leg of the event that unveiled a white version of the sedan. “But it’s different than anything we built in the past 70 years. Porsche is positioning itself for a sustainable future.”Despite all its engineering muscle as the world’s largest automaker, VW has struggled to slow Tesla’s march. The debut of the e-Tron, a challenger to the Model X sport-utility vehicle, was marred by delays and a recall. Tesla chief Elon Musk has meanwhile stretched downmarket with the lower-priced Model 3, which started selling in Europe this year and is about to begin production in China.Higher-Priced VersionsLike Tesla with the Model 3, Porsche is rolling out higher-priced versions of the Taycan first, starting with Turbo S and the $150,900 Turbo. The base version of the car is expected to be priced below $100,000, and a Gran Turismo derivative will start sales at the end of next year.The car will generate a “good margin” starting with the top end versions, Blume said in an interview with Bloomberg TV. Returns won’t be as high as for other models “but this is a start for e-mobility.”The Taycan, boasting technical superlatives such as ultra-fast charging, and the mass-market VW ID.3 will be on display at next week’s Frankfurt auto show, and are slated to start production later this year, leading VW’s more than 30 billion-euro ($33 billion) push to produce battery-powered cars across all price segments. It’s a plan the German manufacturer can ill-afford to see falter.The Taycan “is a turning point for Porsche and the industry as it raises the technical bar for electric vehicles beyond Tesla,” Bloomberg Intelligence analyst Michael Dean wrote in a report. The Taycan should “be profitable from launch given Porsche’s proven pricing power, albeit at vastly reduced margins as compared with gas-powered models.”At last count, the sleek car had attracted about 30,000 deposits. The car is partly financed by a 1 billion-euro ($1.1 billion) green Schuldschein promissory note, the first for a carmaker. It may quickly outsell the iconic 911 that has led Porsche’s appeal among the world’s wealthy for decades. Half of deliveries will be all-electric or hybrid by 2025, Blume said.Read this: Porsche’s $150,000 Electric Taycan Turbo Is Aimed Right at TeslaThe technologically refined car will go head-to-head with Tesla’s aging Model S, after Mercedes-Benz, Jaguar and Audi opted for SUVs to kickstart their electric-car offerings. Tesla is facing concerns over whether it can deliver sustainable profits amid waning demand for its older models while sales rise for the cheaper Model 3.“Model S and X volumes have plummeted in the last two quarters and have been a huge drag on Tesla’s recent financials,” Sanford Bernstein analyst Toni Sacconaghi said in a note. He counted a number of potential factors, including cannibalization from the Model 3, aging product design and new competition.Acceptable ReturnsThe jury is also out on whether Porsche can generate acceptable returns on cars designed to keep the manufacturer’s healthy margins ticking over in the shift to tighter emission rules. It enters the fray in rude health as VW’s most profitable brand.Demand for the Cayenne SUV helped to lift sales by 2% in the first half despite a slowing market. Maintaining healthy operating returns -- at 16.5% during the first six months -- is key to funding VW’s unprecedented shift into the new era.The Stuttgart, Germany-based manufacturer picked the three Taycan event locations to showcase sources of green energy: Niagara Falls in North America for hydro power, a solar farm outside of Berlin and a wind farm in China near the city of Fuzhou. While automakers gradually move toward battery-powered cars, the energy used to charge them often still comes from non-renewable sources like coal plants.Hybrid PromisePorsche has seen promising sales of plug-in hybrid versions of existing models like the Panamera four-door coupe, with over half of customers in Europe going for partially emissions-free options. To ease concerns over going fully electric, the carmaker is installing fast chargers at dealerships in the U.S. and Europe.VW is also participating in Ionity, which is rolling out a network of high-speed charging points across European highways. The Taycan can recharge 100 kilometers (62 miles) in four minutes, and has a total range of 450 kilometers. That compares with a reach of 610 kilometers for the Model S 100D fitted with the biggest battery.High-tech goodies include a horizontal touchscreen that stretches all the way to the passenger side, with a separate control panel. The infotainment integrates Apple Music software that lets drivers capture a song on the radio and add it to an their playlist. (Android-phone owners are out of luck -- Porsche’s infotainment system only works with Apple.)(Updates with CEO comment in sixth paragraph.)\--With assistance from Gabrielle Coppola, Chunying Zhang and Matthew Miller.To contact the reporter on this story: Christoph Rauwald in Frankfurt at crauwald@bloomberg.netTo contact the editors responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net, Elisabeth BehrmannFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- Reuters
Volkswagen making big investment in Turkey - Czech PM
German carmaker Volkswagen is making a big investment in Turkey, Czech Prime Minister Andrej Babis said on Tuesday. "We have heard that Volkswagen is making a big investment in Turkey," Babis said during a news conference after meeting with Turkish President Tayyip Erdogan. Reuters reported last week that Volkswagen was holding talks with officials in Ankara over Turkey's vehicle tax regime as it seeks to conclude a 1 billion euro ($1.11 billion) agreement to build a production plant in Turkey.
- Reuters
UPDATE 1-VW retains access to U.S. public sector contracts, agrees to second monitor at HQ
Volkswagen will not be excluded from public sector contracts in the United States following its emissions scandal but will install a second U.S. monitor at its German headquarters, a spokesman for the carmaker said on Monday. The conditions are part of the latest agreement reached between the German carmaker and the U.S. Environmental Protection Agency (EPA) about Volkswagen's business in the United States after the company in 2015 admitted using illegal software to cheat U.S. pollution tests. The scandal, which became known as Dieselgate, triggered a global backlash against diesel vehicles that has so far cost Volkswagen 30 billion euros ($33 billion) in fines, penalties and buyback costs.
- Reuters
Volkswagen retains access to U.S. public sector contracts, agrees to second monitor at headquarters
Volkswagen will not be excluded from public sector contracts in the United States following its emissions scandal but will install a second U.S. monitor at its German headquarters, a spokesman for the carmaker said on Monday. The conditions are part of the latest agreement reached between the German carmaker and the U.S. Environmental Protection Agency (EPA) about Volkswagen's business in the United States after the company in 2015 admitted using illegal software to cheat U.S. pollution tests. The scandal, which became known as Dieselgate, triggered a global backlash against diesel vehicles that has so far cost Volkswagen 30 billion euros ($33 billion) in fines, penalties and buyback costs.
- Reuters
Lawyers seek $26 million in Volkswagen U.S. fuel economy settlement
Lawyers for owners of 98,000 Volkswagen AG U.S. vehicles that had fuel economy labels that overstated efficiency will ask a U.S. judge for $26 million in attorney's fees and costs, court documents show. On Friday, the Environmental Protection Agency said the largest German automaker must forfeit greenhouse gas emissions credits and lower the fuel economy ratings on those vehicles after it said vehicle software overstated real-world performance. Volkswagen said on Friday it had agreed to a $96.5 million court settlement to reimburse 98,000 consumers.
- TechCrunch
VW Group to pay $96.5M to settle inflated fuel economy lawsuit
VW Group of America said Friday it has reached an agreement with thousands of U.S. customers over alleged inflated fuel economy information on about 98,000 gas-powered vehicles from its four brands, Audi, Bentley, Porsche and Volkswagen. The agreement involves alleged misinformation about fuel economy on 98,000 vehicles, or about 3.5% of the model year 2013-2017 VW Group vehicles sold or leased in the United States.
- Reuters
UPDATE 1-Volkswagen overstated fuel economy on 98,000 U.S. vehicles, will repay consumers
Volkswagen AG must forfeit greenhouse gas emissions credits and is lowering the fuel economy ratings on 98,000 vehicles after the U.S. Environmental Protection Agency said auto software overstated real-world performance. Volkswagen said Friday it had agreed to a $96.5 million court settlement, with no fine, to reimburse affected customers. The software was on roughly 1 million 2013-2017 model year Audi, Bentley, Porsche and Volkswagen vehicles, the agency said.
- Bloomberg
VW to Pay $97 Million, Restate Mileage on U.S. Gas-Powered Cars
(Bloomberg) -- Volkswagen AG will revise fuel economy labels on several gasoline-powered models and pay $96.5 million to drivers after an investigation discovered software that could optimize efficiency during government tests but not during real-world driving.A joint investigation between the U.S. Environmental Protection Agency and the California Air Resources Board discovered the automaker had equipped roughly 1 million vehicles with transmission software that causes gear shifts during EPA prescribed test conditions in a way that “sometimes optimizes fuel economy and greenhouse gas emissions during the test, but not under normal driving conditions,” the agency said in a statement.In 2015, the company admitted to rigging diesel vehicles to cheat on U.S. emissions tests. After putting aside some $32 billion to settle lawsuits and pay damages, the automaker faces further claims from disgruntled investors and customers tied to that scandal.The most recent investigation found that transmission software reduced the fuel economy on about 98,000 gasoline-powered vehicles by 1 mile per gallon, according to the EPA. Volkswagen will forfeit emissions credits for the under-reporting, the agency said.Affected models are several sedans and SUVs from model years 2013 through 2017 sold by Volkswagen in U.S. under the VW, Audi, Porsche, and Bentley brands.Separately, VW said it would reimburse drivers of the vehicles with faulty mileage ratings as part of a $96.5 million settlement with private plaintiffs, the company said Friday. The company will pay customers $5.40 to $24.30 for each month of owning or leasing vehicle, the company said.“Volkswagen is committed to providing customers with transparent fuel economy data for our vehicles, in line with U.S. labeling requirements,” Pietro Zollino, a spokesman for Volkswagen Group of America, said in a statement.(Updates with details of settlement, background and company statement starting in third paragraph)To contact the reporter on this story: Ryan Beene in Washington at rbeene@bloomberg.netTo contact the editors responsible for this story: Jon Morgan at jmorgan97@bloomberg.net, Elizabeth WassermanFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- Reuters
Volkswagen overstated fuel economy on 98,000 U.S. vehicles, will repay consumers
Volkswagen AG must forfeit greenhouse gas emissions credits and is lowering the fuel economy ratings on 98,000 vehicles after the U.S. Environmental Protection Agency said auto software overstated real-world performance. Volkswagen said Friday it had agreed to a $96.5 million court settlement, with no fine, to reimburse affected customers. The software was on roughly 1 million 2013-2017 model year Audi, Bentley, Porsche and Volkswagen vehicles, the agency said.
