VOW3.DE - Volkswagen AG

XETRA - XETRA Delayed Price. Currency in EUR
-1.08 (-0.73%)
At close: 5:35PM CEST
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Previous Close147.00
Bid146.02 x 207000
Ask146.04 x 63200
Day's Range145.10 - 147.16
52 Week Range131.44 - 163.98
Avg. Volume1,051,410
Market Cap74.471B
Beta (3Y Monthly)1.01
PE Ratio (TTM)6.35
EPS (TTM)22.98
Earnings DateMar 14, 2016 - Mar 18, 2016
Forward Dividend & Yield4.86 (3.31%)
Ex-Dividend Date2019-05-15
1y Target Est198.76
  • Audi SQ8 TDI puts 429 hp and 664 lb-ft in a svelte package
    Autoblog9 hours ago

    Audi SQ8 TDI puts 429 hp and 664 lb-ft in a svelte package

    The Audi SQ8 TDI is here, wrapping the same diesel-hearted powertrain from the SQ7 TDI in a more lissome package. That means a 4.0-liter V8 oil-burner with two sequential turbochargers terrifying the roadways with 429 horsepower and 664 pound-feet of torque.

  • Reuters8 hours ago

    Traton trading at mid-point of IPO range in grey market

    Shares in Volkswagen's truck unit Traton were trading on the grey market at around the mid-point of its initial public offering price (IPO) range ahead of its market debut on Friday. Shares in the IPO are being offered at 27-33 euros. Volkswagen aims to raise up to 1.9 billion euros ($2.1 billion) through the IPO, scaling back earlier ambitions to list up to a quarter of the unit by opting to float a 10% stake.

  • Daimler's New Leaders Confront Old Issues as Diesel Bites

    Daimler's New Leaders Confront Old Issues as Diesel Bites

    (Bloomberg) -- Just one month into the job, Daimler AG’s new executive duo is unearthing skeletons from the diesel-scandal era, hobbling the move toward an electric future with a crisis that erupted almost four years ago.After previously promising a slight earnings gain for 2019, operating profit this year will fail to grow, Daimler said late Sunday in its third downgrade in a year. The company blamed proceedings around allegations of emissions tampering in diesel cars for the more muted outlook, which required higher provisions to account for recalls. The stock fell as much as 5.1%, almost erasing the gain that Daimler had built up since the start of the year.The more pessimistic outlook heaps pressure on Chief Executive Officer Ola Kallenius, who’s flanked by new Chief Financial Officer Harald Wilhelm, to implement their proposal to rein in costs and restore profitability, having taken over only recently from long-term CEO Dieter Zetsche. But investors say the duo’s future strategy remains light on details and lament the rapidly recurring revisions that are without precedent in the German car industry.“It all comes back to the same old fact: Daimler needs to execute better,” said Arndt Ellinghorst, an analyst in London at Evercore. “The endless array of so called ‘one-time’ effects raises questions regarding process, management information systems and ultimately accountability of management.”Ups and DownsZetsche’s own tenure of more than a dozen years had known its ups and downs, skewed toward the latter in the period before his departure. After managing to return Daimler to the top of the luxury-car pack, his last year at the helm was marked by two profit warnings and a falling stock, which ended the year down by more than a third, a considerably poorer return than its two big German rivals, BMW AG and Volkswagen AG.The German car industry is facing a litany of issues, from the costly switch to electric and self-driving cars, to the trade war between the U.S. and China that has complicated sales, because some of the biggest production sites sit in the U.S. and ship their cars to Asia.And while the diesel crisis first erupted at VW in late 2015, it has engulfed the entire industry. Days before the latest warning, Daimler suffered a fresh setback when German regulators issued a mandatory recall for about 40,000 Mercedes GLK SUVs over potentially illegal software to skirt emissions rules. A spokesman declined to comment on a connection to the profit warning.German authorities already slapped Daimler with a recall of 774,000 diesel cars in Europe last June over the use of prohibited devices regulating their emissions. The company continues to claim a clean-engine record.Corporate Culture“Clearly both the near term operational challenges and possible questions around Daimler’s corporate culture are issues that must be addressed with urgency by Daimler’s new CEO,” Dorothee Cresswell, an analyst at Barclays Equity Research, said in a June 24 note.The provision of as much as 1 billion euros may also raise questions on the sustainability of the dividend, which Daimler reduced recently, said Bloomberg Intelligence analyst Michael Dean. The company paid out 3.25 euros a share last year, down from 3.65 euros. While shares fell 4% to 47.65 euros at 2:51 p.m. in Frankfurt trading, bondholders took the third profit warning in their stride.The carmaker’s most liquid euro-denominated bonds, maturing in 2023 and 2026, are barely moving in Monday trading, based on data compiled by Bloomberg. The cost of five-year default insurance remains near its lowest level in more than a year after rising almost 2.5 basis points to 56.9 basis points, based on CBIL prices.Facing InvestigationsThe German manufacturer is facing investigations in Europe and the U.S. over allegedly excessive pollution from its diesel vehicles. Daimler has agreed to software upgrades for millions of cars in Europe, while so far escaping fines. That’s in contrast to VW, where the scandal has so far cost the world’s biggest carmaker 30 billion euros ($34 billion) in fines and provisions.Highlighting the breadth of issues, Daimler on Sunday also warned that its struggling van unit will be unprofitable this year, with a return of sales of minus 2% to minus 4%. The division slumped to a surprise loss in the first quarter as plans to produce a Mercedes-Benz pickup truck in South America fell through.For Kallenius and Wilhelm, the latest revision offers a chance to clean house ahead of a more comprehensive overhaul. Last month, shareholders approved a new corporate structure that will give its divisions for cars, trucks and mobility services more independence. While Daimler’s woes at the Mercedes-Benz cars division underscores the urgency behind the move, it could rally criticism from some investors to implement deeper changes, including a separate listing for the sprawling trucks division, a step that would mimic a move by VW.Kallenius may be new in his job, but he’s no stranger to Daimler, having worked for the company his entire professional life. Wilhelm, too, is familiar with the company, having worked at the carmaker prior to his years spent as finance chief for Airbus SE. Still, the duo may find that they’ve not reached the bottom yet in terms of financial expectations for the year, said Marc-Rene Tonn, an analyst at Warburg Research, citing a “less favorable” sales mix and supply chain constraints.“We fear that Sunday’s profit warning may not be the last for the current year,” he said.(Updates with dividend comment in 10th, bond reaction in 11th paragraph.)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, Benedikt Kammel, Elisabeth BehrmannFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Mercedes Isn't Looking Too Reliable These Days

    Mercedes Isn't Looking Too Reliable These Days

    (Bloomberg Opinion) -- When Volkswagen AG admitted rigging diesel emission tests in September 2015, its German rival Daimler AG sounded pretty dismissive in defending the compliance of its own Mercedes-Benz vehicles. “We categorically deny the accusation of manipulating emission tests regarding our vehicles,” the luxury car giant said. “A defeat device, a function which illegitimately reduces emissions during testing, has never been and will never be used at Daimler. This holds true for both diesel and petrol engines. Our engines meet and adhere to every legal requirement.”If Daimler shareholders concluded from that statement that the company wouldn’t have to recall any diesel vehicles, or that it wouldn’t face any financial or legal repercussions related to its diesel emissions, they’ve been sorely disappointed. On Sunday Daimler warned of a high three-digit million euro hit to profit because of provisions for “various ongoing governmental proceedings and measures relating to diesel vehicles,” without saying what these were. Group operating profit is now expected to stagnate this year.This was Daimler’s third profit warning in 12 months and all have involved unexpected diesel costs to some extent. The shares gave up about 2 billion euros ($2.3 billion) of market value on Monday – more than twice the expected hit to profit – which suggests investors fear this won’t be the end of it.And who could blame them? On diesel, as with its own earnings forecasts, Daimler is in danger of being seen as unreliable counsel. The share price, which essentially has gone nowhere since 2007, reflects that distrust.The distinction will probably be lost on city-dwellers who breathed in poisonous diesel fumes, but to this day Daimler insists its diesels didn’t break the law. European vehicle emissions rules were loosely written. Turning down or switching off emission controls to protect the engine in certain circumstances – such as lower temperatures – was allowed and loopholes like this were widely used (and abused by the industry).So far, Daimler has escaped fines and the balance sheet damage has been limited. In contrast, VW has incurred about 30 billion euros of diesel-related costs since it confessed to cheating.Daimler has, though, recalled millions of diesel vehicles since 2015 (some voluntarily, some not) after several models were shown to have belched out far more nitrogen oxide pollution when driven on streets than when tested in the laboratory. In fairness, Mercedes is by no means the only carmaker where that’s been the case. But national regulators have at times seemed oddly reluctant to investigate or punish such large employers. Mercedes’s latest recall came over the weekend when thousands of GLK diesel SUVs were called back to the garage because of software that the regulator said potentially distorted test results.The legal risks section of Daimler’s annual report discusses the various diesel-related troubles at some length. The legalese makes it hard to follow but there’s no hiding the fact that Daimler is facing trouble on more than one continent: Stuttgart prosecutors have opened a criminal investigation on suspicion of fraud and false advertising; the German regulator KBA has said the company used “impermissible defeat devices;” and the U.S. Department of Justice has asked Daimler to conduct an internal investigation. Meanwhile, the company faces class actions and other lawsuits over allegations of excessive diesel emissions and false advertising, which Daimler denies.The car giant has a new chief executive and new chief financial officer (Ola Kaellenius and Harald Wilhelm) and therefore a rare opportunity for a fresh start. Getting to grips with the diesel problems, and communicating about them more transparently, needs to be a top priority.There’s a danger it will become a millstone instead. Daimler has invested heavily in a new diesel engines and recent tests have shown them to be relatively clean. Selling lots of those vehicles would help lower the carbon dioxide emissions of the Mercedes fleet and thus avoid regulatory fines. However, another barrage of negative diesel headlines won’t help reassure a still skeptical car-buying public. Unfortunately for Daimler, there is also nothing it can do to speed up or resolve the various litigation proceedings and investigations.At a time when heavy spending on electric and autonomous driving technology is putting pressure on Daimler’s cash flow, unexpected diesel costs are the last thing it needs. No wonder it’s been so vocal about the need to cut costs. Mercedes-Benz’s corporate slogan is “the best or nothing.” Right now it feels like the latter.  To contact the author of this story: Chris Bryant at cbryant32@bloomberg.netTo contact the editor responsible for this story: James Boxell at jboxell@bloomberg.netThis 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/opinion©2019 Bloomberg L.P.

  • Volkswagen wins lawsuit over who designed the Beetle
    Autoblog4 days ago

    Volkswagen wins lawsuit over who designed the Beetle

    As first reported by Automotive News, a German court presented its ruling in favor of Volkswagen on a lawsuit regarding the original designer and copyright holder of the Volkswagen Beetle design. The court's statement tells us that the lawsuit was brought by the daughter of late car designer Erwin Komenda, who worked for Ferdinand Porsche in the 1930s. The court did recognize the right of Komenda's daughter to bring the lawsuit as Erwin Komenda had clearly been an employee of Porsche and involved in the development of the Beetle.

  • Luxury Holidays and SUVs Are Badges of Shame Now
    Bloomberg4 days ago

    Luxury Holidays and SUVs Are Badges of Shame Now

    (Bloomberg Opinion) -- The windshields of large cars parked in my Berlin neighborhood were plastered this week with angry messages on lurid orange stickers. The owners were told that: “Driving an SUV causes serious climate damage,” “SUVs harm your unborn child,” and “Driving an SUV causes impotence.” That last one may have been a joke.Sports utility vehicles have long been hated by the more civic-minded among us. They tend to consume more fuel, spew out more pollution and take up more parking space. It’s been suggested that their size and weight are also partly to blame for the rising number of pedestrian road deaths.The car industry has carried on regardless, producing millions of these gas-guzzlers to hugely profitable effect. Just look at Fiat Chrysler Automobiles NV and its lucrative love affair with Jeep and RAM trucks. But things might start to change and there’s one big reason why: Shame.With most people now recognizing the threat of an overheating planet, it’s hard to pretend that your huge car isn’t part of the problem. And it’s this embarrassment factor that Berlin’s environmental activists were targeting so effectively with their orange stickers. That should deeply trouble many in the car industry who have made all-in bets on SUVs and trucks. Other sectors whose consumer products or services are visible polluters won’t escape either.Shame has long been recognized as an effective tool for changing antisocial behavior. Back when we were hunter-gatherers, it helped tribes preserve social cohesion; being ostracized was potentially fatal and thus selfishness was best avoided.Shame is what makes the Fridays for Future movement, which encourages school children to go on strike about climate change, so effective. It’s embarrassing that it takes our kids to show us we’re screwing up the planet, and it’s also a reminder that they’ll suffer more from climactic catastrophe. The same can be said for Britain’s traffic-stopping Extinction Rebellion protests, which were met by a surprisingly sympathetic response from the public. And social stigma is certainly what’s driving a burgeoning boycott of passenger flights in northern Europe. Sweden even has a word for it: “Flygskam” (flying shame). Boasting on social media about that trip to the Maldives has become deeply uncool, just like turning up at the school gates in a Land Rover.Embarrassment is already a powerful force in politics and the corporate world. The publication of gender pay figures or CEO-to-worker salary ratios is all about guilt-tripping companies into more equitable practices. California names and shames the most delinquent tax payers, which is a decent incentive to pay up.Like the car industry, the aerospace world is acutely aware of the potential business damage from this phenomenon. At this week’s Paris Air Show, executives were on the defensive. The chief technology officers of seven leading manufacturers made a rare joint statement emphasizing their commitment to decarbonizing flight. It’s a pretty forlorn task. They know that twin-aisle commercial jets won’t run only on electric power for decades – the thrust required is simply too great.An aviation industry plan to cap emissions at 2020 levels has been criticized for its reliance on questionable carbon offset projects. Some analysts think that a Nordic-style public backlash that spurs governments into taxing the industry properly is a serious threat to its growth. “We can easily imagine how environmental awareness might cap consumer demand for second or third holidays by air,” says HBSC’s Andrew Lobbenberg.Of course, an embarrassed individual’s decision to fly less and drive a smaller car won’t solve the problem by itself. Governments have to take decisive and united action to decarbonize the global economy by tackling heavy industry and power production. The success of the Greens in the recent European elections shows that’s what many people want.Unfortunately the European Union failed this week to agree on a net-zero carbon emissions target for 2050 because of opposition from coal-dependent central European states. Even Germany, Europe’s wealthiest economy, doesn’t intend to phase out coal until 2038. You can see then why many environmental protesters have decided to take their message directly to individual consumers. The shaming of car buyers and airline passengers still doesn’t capture some of the worst decisions we make as consumers of energy, though. A study commissioned by the British government on how the country could get get to net-zero emissions noted there was still no serious plan for decarbonizing U.K. heating systems. Yet nobody goes around putting stickers on homes with gas boilers.  Still, most of us realize that the consumption decisions we make are contributing to the climate crisis. Our kids will grow up on an increasingly inhospitable planet and many of us long to be rid of that legacy.That’s why I think there’s reason for optimism around the activities of one of the worst pollution culprits in recent years: Volkswagen AG. After the disgrace of its diesel emissions cheating scandal, the world’s biggest carmaker has found the electric faith and expects 40 percent of its sold vehicles will be battery-powered in 2030. It still sells too many combustion engine SUVs but it wears that shame on its sleeve, admitting that its cars and trucks produce as much as 2 percent of global carbon emissions.  VW’s latest TV ad features an employee despairing about “dieselgate.” With a Simon and Garfunkel track to get us in the forgiving mood, the designer sketches the outline of an electric camper van – a throwback to the old hippie bus, just without the pollution. My guess is that Berlin activists won’t be putting stickers on one of those in future. They’ll be driving one.To contact the author of this story: Chris Bryant at cbryant32@bloomberg.netTo contact the editor responsible for this story: James Boxell at jboxell@bloomberg.netThis 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/opinion©2019 Bloomberg L.P.

  • Reuters5 days ago

    UPDATE 1-Trump administration readying final review of new vehicle fuel economy rules

    Trump administration officials defended their controversial proposal to freeze fuel efficiency requirements at 2020 levels at a congressional hearing on Thursday and said the proposal would be submitted to the White House for final review in the coming weeks. The administration has rebuffed requests from automakers and some lawmakers to make a last-ditch effort to reach a deal with California to extend national standards after it ended talks in February. The administration plans in the coming months to finalize a dramatic rewrite of fuel efficiency standards through 2026 that would also strip California, the most populous U.S. state, which wants stricter rules to fight climate change, of the right to set its own, tougher emissions rules.

  • Bloomberg5 days ago

    GAM. Woodford. H2O. There’s Never One Cockroach

    (Bloomberg Opinion) -- There’s never just one cockroach. That market truism, noted more than a decade ago by market strategist Dennis Gartman, has been useful in divining the aftershocks of everything from the credit crunch to the European debt crisis to the Volkswagen AG emissions cheating scandal. So it shouldn’t be a surprise that it also seems to apply to fund manager Neil Woodford and his misadventures in stocking his portfolio with illiquid investments.Shares in Natixis SA dropped to their lowest in three years after the Financial Times wrote that one of its investment funds, H2O asset management, had loaded up on hard-to-trade bonds of companies related to German entrepreneur Lars Windhorst. The article prompted Morningstar to suspend its rating on one of the funds managed by H2O, which oversaw almost $33 billion at the end of last year.Shareholders of Natixis may have overreacted, given that the fund unit accounts for only about 6 percent of the French bank’s net income, according to Jefferies analyst Maxence Le Gouvello du Timat. But Morningstar isn’t likely to hang around in dropping any other funds it deems to be at risk of trapping investors due to liquidity mismatches, especially given that it’s taken GAM Holding AG a year to unwind its absolute return bond funds after freezing them. The revelations about the scale of Woodford’s escapades prior to his move earlier this month to freeze redemptions from his flagship fund suggest that investors can’t rely on the regulator to safeguard their interests.In a letter published this week, the Financial Conduct Authority revealed that its “preliminary supervisory inquiries” suggest Woodford had about 20% of his Woodford Equity Income Fund in unlisted securities in February of this year. That’s astonishing.The maximum allowed for the fund was 10%. So Woodford didn’t just edge over the limit, he blasted through it. For every 100 pounds ($127) invested, 20 pounds was in illiquid investments, double the amount that investors in his fund would have expected.Moreover, the FCA said this was the third time the fund had exceeded its illiquidity limits, following breaches in February and March of last year that “were each notified to us as resolved within a timeframe we had agreed.” And yet, on all three occasions, investors were left in the dark."At no point would it have been appropriate for the FCA to notify any platform or investors of these breaches,” a spokesman for the regulator told the Telegraph earlier this week.Really? I can just about see how last year’s transgressions could be forgiven if they were inadvertent and swiftly resolved. But having twice as much of the fund in unlisted investments in February strikes me as an entirely appropriate time for the regulator to force it to come clean with the investors it owed a duty of care to, even if the FCA itself didn’t type the email or sign the letter advising them of the infringement.It’s still not clear how long the 3.8 billion pounds will remain frozen in Woodford’s fund, or indeed how much money investors will end up getting back. But now would be a good time for the trustees of every single fund they’re responsible for that offers daily withdrawals to ask some hard questions about just how easy it would be to buy and sell the securities in the portfolios if a flood of investors demanded their money back.To contact the author of this story: Mark Gilbert at magilbert@bloomberg.netTo contact the editor responsible for this story: Jennifer Ryan at jryan13@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Mark Gilbert is a Bloomberg Opinion columnist covering asset management. He previously was the London bureau chief for Bloomberg News. He is also the author of "Complicit: How Greed and Collusion Made the Credit Crisis Unstoppable."For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.

  • Bloomberg5 days ago

    Waymo to Study Driverless Services With Renault-Nissan Alliance

    (Bloomberg) -- Waymo LLC agreed to explore driverless services with Renault SA, Nissan Motor Co. and Mitsubishi Motors Corp., pairing a leader in self-driving technology with the world’s largest automotive alliance.The three carmakers and Alphabet Inc.’s autonomous-vehicle unit will study market opportunities and research legal and safety issues related to driverless transportation services in France and Japan, the companies said in a statement Thursday. The deal doesn’t extend to cooperation producing robo-vehicles.“We’re convinced that with this added expertise, we’ll be able to position ourselves for autonomous services that are viable for customers,” Hadi Zablit, senior vice president for business development at the Renault-Nissan-Mitsubishi alliance, told reporters in Paris. When it comes to implementation, the three automakers won’t necessarily offer services in common with Waymo, he said.The French-Japanese alliance produced more than 10 million vehicles last year — on a par with the biggest carmakers: Volkswagen AG and Toyota Motor Corp. Unlike Waymo’s previously announced deals with Fiat Chrysler Automobiles NV and Tata Motors Ltd.’s Jaguar Land Rover, the partnership with Renault-Nissan-Mitsubishi doesn’t include supplying any cars.Waymo’s parent company, Alphabet, struck a separate deal with the three-way partnership last September, giving its Google Android operating system access to their vehicle dashboards starting in 2021.The new agreement marks a first step toward developing long-term, profitable driverless-vehicle services for passengers and deliveries, the companies said. While the analysis will take place first in France and Japan, they said it may expand to other markets — excluding China — in the future.Zablit sees deployment of the new mobility services in less than 10 years.For Renault and Nissan, working with Waymo brings expertise as the race to develop autonomous vehicles heats up. It also shows the French and Japanese manufacturers continue to collaborate on key strategic matters, even after their two-decade partnership was shaken by the arrest in November of former leader Carlos Ghosn in Japan over alleged financial improprieties.Tensions escalated after Renault pursued a combination with Fiat without initially telling its Japanese partners. Those merger talks have since ended.To contact the reporter on this story: Ania Nussbaum in Paris at anussbaum5@bloomberg.netTo contact the editors responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net, Frank Connelly, Chester DawsonFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Czech owners of Skoda, Volkswagen cars qualify for $23 million compensation, court says
    Reuters6 days ago

    Czech owners of Skoda, Volkswagen cars qualify for $23 million compensation, court says

    A Prague district court has ruled that a number of Czech owners of Skoda and Volkswagen cars qualify for 533 million crowns ($23.30 million) in compensation linked to VW's diesel emissions scandal, the ruling seen by Reuters said. The decision, ordering Volkswagen to pay the full amount, is open to appeal but only on procedural grounds. Volkswagen said it would launch an appeal.

  • Volkswagen CEO wants new Golf out by end of the year
    Autoblog7 days ago

    Volkswagen CEO wants new Golf out by end of the year

    Reports are coming out that Volkswagen's boss wants the new, eighth generation Golf to debut before the end of the year. Company CEO Herbert Diess has expressed his desire for the Golf to be launched before 2020, including delivering the first vehicles. In addition to some engineering setbacks, including making sure the car's over-the-air update capability will not be compromised by hackers, the deadline is challenged by some Volkswagen executives who would rather see the car launched in early 2020 instead of speeding up the debut, reports Automotive News.

  • VW backs ID. electric vehicles with eight-year/99,418-mile battery warranty
    Autoblog8 days ago

    VW backs ID. electric vehicles with eight-year/99,418-mile battery warranty

    Volkswagen has kept itself in the news cycle with a steady drip of information about its upcoming electric vehicles. The massive company push, including a reflective commercial that features the VW ID. VW has to not only rebuild the public's confidence in the brand, it also has to improve the public's perception of EVs.

  • Benzinga8 days ago

    Navistar Putting More Money To Work In Alabama

    Medium- and heavy-duty truck manufacturer Navistar (NYSE: NAV) announced plans to invest $125 million in new and existing facilities in Alabama. NAV already manufactures the International brand of diesel engines at its Huntsville plant. The primary engine produced in the Huntsville facility is the A26, Navistar's 12.4 liter big-bore engine used in its LT- and RH-Series Class 8 heavy-duty trucks as well as some vocational trucks.

  • VW's $2 Billion Truck IPO Reflects Push to Trim the Empire
    Bloomberg8 days ago

    VW's $2 Billion Truck IPO Reflects Push to Trim the Empire

    (Bloomberg) -- Want the lowdown on European markets? In your inbox before the open, every day. Sign up here.Volkswagen AG’s plan to list its truck division later this month will test whether it can pull off a feat that was once unthinkable for the German automotive giant: get smaller.For decades, the world’s biggest carmaker only knew how to expand -- adding Bentley luxury cruisers, Ducati racing bikes and Scania heavy trucks while taking its network of factories well past the 100 mark and its headcount over 640,000.Even in the face of the debilitating diesel-cheating scandal in 2015, the manufacturer didn’t trim its portfolio, bolstering investment in electric cars instead and even creating a new division for mobility services.Now with the pace of change in the auto industry quickening, Volkswagen is trying its hand at trimming the empire.If the listing of a minority stake in Traton SE -- a truck and bus maker with three vehicle brands and valued at as much as 16.5 billion euros ($18.5 billion)-- goes well, it would give Chief Executive Officer Herbert Diess more sway to balance the often diverging interests of VW shareholders including the Porsche and Piech owner family, Lower Saxony and powerful labor unions.Healthy Valuation“Traton’s IPO pricing suggests a healthy valuation which puts a spotlight on VW’s significant sum-of-its-parts disconnect,” RBC Capital Markets analyst Tom Narayan said in a note. Concerns over the company’s ability to switch to electric vehicles is “unfairly” weighing on its share price, the analyst said.Volkswagen rose 0.2% to 141.42 euros at 11:46 a.m. in Frankfurt trading, taking gains this year to 1.8%.For now, Diess is seeking deeper technology partnerships and the possible sale of assets like transmission maker Renk AG and MAN Energy Solutions, which develops engines. A successful Traton listing, targeted for June 28, could even spark rival Daimler AG to follow suit with a carve-out of its own truck business.The truck group comprises three main assets, Scania, MAN and Volkswagen-branded budget trucks sold in South America and Africa, as well as a unit offering digital services to fleet operators. With 29 production and assembly sites globally, the business last year sold 223,000 vehicles. While that’s 14% more than a year earlier, it’s less than half of Daimler’s truck division, the world’s biggest.Volkswagen is offering 50 million Traton shares at 27 euros to 33 euros apiece, plus a possible over-allotment of 7.5 million shares, meaning at the top end of the price range, the sale would raise as much as 1.9 billion euros. Here are the key points in one of the biggest initial public offerings in Europe this year:Sales PitchTraton is looking to woo investors by combining the best-in-class technology and strong margins of the Scania unit with the prospect of a turnaround at MAN and growth potential in key markets, according to company presentations and research from advising banks seen by Bloomberg.The plan includes the following four pillars:StrengthsChief Executive Officer Andreas Renschler, 61, is the mastermind behind Traton. After helping to establish Daimler’s commercial vehicles business as the world’s largest, he was lured to Volkswagen in 2014. Despite the partly overlapping operations, he’s improved earnings over the past four years, mainly by enforcing closer cooperation between long-standing rivals Scania and MAN. Investor interest in Traton will largely be a bet on Renschler’s veteran skills to deliver in the cyclical truck market.The timing of the listing, which was delayed earlier this year, is complicated by global volatility. The window may be as good as it gets. Rival Volvo Group -- the main pure-play competitor -- has gained 26% this year.“It’s no secret that the market environment is very volatile,” VW Chief Financial Officer Frank Witter told reporters on Monday. “It’s not ideal, but it’s not bad either.”VW remains open to sell more Traton stock at a later stage, up to a maximum stake of 24.9%, if market conditions are supportive, he said.WeaknessesTraton has only small bridgeheads in the key North American and Chinese markets, and the prospects for expanding those positions face obstacles.In North America -- the truck industry’s largest profit pool -- Traton merely owns a 16.8% shareholding in Navistar International Corp., which doesn’t it allow it to do much. Lifting the stake will cost money and add complexity. Meanwhile, Navistar still faces fierce competition from market leaders -- Daimler’s Freightliner, Volvo’s Mack and Paccar Inc.While Daimler and Volvo have functioning production joint ventures in China, the world’s biggest truck market, Traton’s cooperation with Sinotruk Hong Kong Ltd., where its holds a 25% stake through MAN, has yet to deliver the hoped-for results.Alliances can fall short of aspirations to create economies of scale, with the recent tensions at the Renault-Nissan Alliance a fresh reminder of the difficulties in uniting separate cultures. Traton also has a cooperation with Hino Motors Ltd., a Toyota Group company, on electric technology, product development and purchasing.MAN has long attempted a turnaround, but improvements have been tepid compared to an aggressive restructuring at Volvo that doubled margins within roughly three years. MAN’s production footprint in high-cost Germany and a lineup that includes less-profitable medium-duty trucks limits the potential for improvement.(Updates with CFO comment in 14th paragraph.)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, Chris Reiter, Elisabeth BehrmannFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Barrons.com9 days ago

    Beyond Meat Stock Shot Higher Because Short Sellers Lost Big Time

    The maker of plant-based burgers reported first-quarter earnings that exceeded Wall Street estimates last week, but the stock jumped because people betting against Beyond Meat went through the grinder.

  • Reuters9 days ago

    UPDATE 3-Former Algerian officials questioned over corruption - TV

    Two former powerful Algerian officials and a prominent businessmen were questioned in courts on Sunday, state TV said, over accusations of corruption in the ruling elite under ex-president Abdelaziz Bouteflika. Protesters and the army drove Bouteflika to resign on April 2 after two decades in power, but pressure has continued for the departure and prosecution of senior figures around him. Among a plethora of ongoing cases, former finance minister Karim Djoudi appeared before the Supreme Court on Sunday, while former prime minister Ahmed Ouyahia was in another Algiers court, both over corruption accusations, state TV said.

  • Bologna airport has a Lamborghini Huracán taxi car
    Autoblog10 days ago

    Bologna airport has a Lamborghini Huracán taxi car

    Bologna, Italy, has the best welcome sign of all time. It's striped across a Lamborghini Huracán at Aeroporto Marconi di Bologna. Lamborghini took to social media this week to show off its newest design, a Huracán RWD airport car, and it's not just for show.