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Volkswagen:Quarterly Results/2024 Q1: Difference between revisions
Volkswagen:Quarterly Results/2024 Q1 (view source)
Revision as of 16:45, 30 April 2024
, 30 April 2024→Earnings Call Summary
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* SKODA recently revealed its Epiq, its first entry-level BEV that will be delivered to customers from 2026 starting at 25,000 euros. | * SKODA recently revealed its Epiq, its first entry-level BEV that will be delivered to customers from 2026 starting at 25,000 euros. | ||
* Q1 marked launch of the first Porsche and Audi models based on the PPE platform. | * Q1 marked launch of the first Porsche and Audi models based on the PPE platform. | ||
* When it comes to order intake, they still have more chance with Q6 e-tron and the ID.7 Tourer, which are not in the market yet. | |||
=== Q1 2023 Results === | === Q1 2023 Results === | ||
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* Recorded a significant overhead cost in Q1 (against their overhead cost discipline) due to wage increases in 2023 and weaker sales revenue growth. | * Recorded a significant overhead cost in Q1 (against their overhead cost discipline) due to wage increases in 2023 and weaker sales revenue growth. | ||
* R&D expenses increased by around 1 billion euros in Q1 . | * R&D expenses increased by around 1 billion euros in Q1 . | ||
* Brand Group Progressive operating profit was also burdened by valuation effects of about 0.3 billion euros, resulting from order residual value model. Adjusted for valuation effects, operating margin would have been 6%, still below their 8% to 10% 2024 target. | * Brand Group Progressive operating profit was also burdened by valuation effects of about 0.3 billion euros, resulting from order residual value model. Adjusted for valuation effects, operating margin would have been 6%, still below their 8% to 10% 2024 target. The difference between the 6% and the 8% to 10% is the impact of supply chain issues. | ||
* Contract volume at the Volkswagen Mobility Group was stable. A slightly lower number of financing contracts were compensated by an increase in leasing and insurance contracts. | * Contract volume at the Volkswagen Mobility Group was stable. A slightly lower number of financing contracts were compensated by an increase in leasing and insurance contracts. | ||
* Operating profit at the Volkswagen Financial services was down 6% to 881 million euros due to normalization of used vehicles prices and provisioning of residual value risk as well as increased interest rates. | * Operating profit at the Volkswagen Financial services was down 6% to 881 million euros due to normalization of used vehicles prices and provisioning of residual value risk as well as increased interest rates. | ||
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* Volkswagen expects model and brand mix to improve in the coming months. | * Volkswagen expects model and brand mix to improve in the coming months. | ||
* They expect pricing to continue to be slightly supportive, "benefiting from rollover effect from last year's price increases but burdened by higher temporary sales promotions for our electric vehicles." | * They expect pricing to continue to be slightly supportive, "benefiting from rollover effect from last year's price increases but burdened by higher temporary sales promotions for our electric vehicles." | ||
* Expect product costs to provide tailwind for the rest of the year. | * Expect product costs to provide tailwind for the rest of the year (material cost to contribute 1 billion euros tailwind going forward). | ||
* They said they review the global BEV sales expectations continuously and are prepared to adjust capacity and capex planning in Powerco accordingly, if necessary. | * They said they review the global BEV sales expectations continuously and are prepared to adjust capacity and capex planning in Powerco accordingly, if necessary. | ||
* '''Volkswagen expect an improvement in margin and financial performance already in Q2 and stronger earnings trajectory in the rest of the year.''' | * '''Volkswagen expect an improvement in margin and financial performance already in Q2 and stronger earnings trajectory in the rest of the year.''' | ||
* They will book a severance expense of 900 million euros in Q2 which | * They will book a severance expense of 900 million euros in Q2 which will be compensated in the full year. | ||
* Their target for net cash flow in 2024 is 4.5 to 6.5 billion euros. About 6 billion will go to the ramp up of the battery business, 4 billion out of that is R&D and Capex and 2 billion is for additional M&A (more control of the value chains eg raw materials such as cobalt, nickel and lithium. | |||
* '''In Q2, they expect margin to be inline with their full-year guidance, but the €900 million severance cost might lead to a burden in that respect. However, they expect to compensate in the remainder of the year.''' | |||
* They expect significant improvement in Audi margin in Q3 going forward. | |||
* Wages were not increased in Q1 2023, hence Q2 2024 going forward will benefit from increases in the other quarters last year (n strong comps as a result of that). | |||
=== China === | |||
* They have a strong ICE business with strong margins and cash flow delivery in China. | |||
* The BEV market is very challenging when it comes to pricing, hence they will always make sound compromise between price and volume in order to achieve a balanced approach. | |||
* In the coming quarters, ICE business will jump over 20% market share. | |||
=== Residual values === | |||
* They have seen normalization in residual values, with more pressure on the BEV side. | |||
* But the residual values in general are still strong. | |||
=== Free float === | |||
* Arno only said they are open for free float at the right time. | |||
* | * | ||