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Software is to become the third financial pillar of the group in the future
At the "New Auto" event on Tuesday, VW CFO Arno Antlitz explained how the group intends to make money in the future. Is that exclusively Volkswagen’s business? Well, there are definitely things that car fans should be interested in.
The industry is currently in the midst of the transition to electromobility, according to Antlitz. This also has an impact on profitability. Only in 2030 will the auto industry earn as much money with electric cars as it does with combustion engines (cars with integrated combustion engines, ICE).
From 2025, the group should also earn money with software. In the year 2030, this source of income should bring about as much as ICE cars and electric cars. Since combustion engines will be an important source of money until at least 2030, the group wants to keep its ICE cars competitive until then. At the same time, however, investments must be shifted towards electric cars and software.
The profits from the combustion engines will continue to decline until 2030, VW believes – due to dwindling sales figures and stricter emissions regulations such as the Euro 7 standard. As a countermeasure, VW wants to reduce the complexity of the combustion engines. No less than 60 percent of the combustion engine models in the EU should be eliminated by 2030:
The modular transverse matrix (MQB) is intended to ensure that the production volume of Volkswagen does not drop too much. Interesting here: The larger combustion platforms MLB and MSB did not mention Antlitz at a word. The Audi A4 or the Porsche Panamera, for example, are based on these.
In general, the group will in future divide its numerous brands into the groups Volume (under the management of the VW brand), Premium (under the management of Audi) and Sport (under the management of Porsche). Then there is the Traton commercial vehicle division. The brands of the individual groups should work better together.
The share of electric cars in the Group’s global sales is expected to increase from around six percent in 2021 to around 50 percent in 2030:
The independent software division Cariad should be an important pillar in terms of profitability. It will initially cost around 2 to 2.5 billion euros per year. Later, however, it should become profitable, through license fees – either from the group brands or from external customers. According to the following graphic, break even should be reached in 2025:
More from the "New Auto" event: Volkswagen New Auto: Finally, more clarity on the platforms
Volkswagen New Auto: News about batteries and the charging network
Here is the entire event. The part "Value Creation" by CFO Antlitz starts at around 28:00.
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