AutoBeta(AutoBeta.net)02/28 Report--

Due to the impact of the COVID-19 epidemic in 2020, the global automobile market has suffered an unprecedented impact. In this environment, it is rare for car companies to make a profit. Recently, Volkswagen, Europe's largest automobile group, reported its 2020 results, which showed that the group made an after-tax profit of 8.82 billion euros (about 68.933 billion yuan) last year, but its profit also fell by nearly 40% compared with the previous year.

According to Volkswagen Group's previous forecast, the company will make an operating profit of 10 billion euros (78.822 billion yuan) in 2020, minus expenses on special diesel-related projects, of which the cash flow from the automotive business is about 6 billion euros. It is smaller than today's 8.82 billion euros (about 68.933 billion yuan).

Although this is nearly half of last year's operating profit, it is still higher than the 4.8 billion euros that analysts had expected for Volkswagen's operating profit, indicating that Volkswagen outperformed market expectations even in a relatively bad market in 2020.

The reason for the halving of revenue and profit is still due to a marked decline in Volkswagen sales. According to the financial report, Volkswagen Group sold 9.2 million new cars worldwide in 2020, down 16.4 percent from the same period last year, while operating revenue from automobiles was 222.9 billion euros, down 11.8 percent from the same period last year. As a result, Volkswagen had its worst sales performance in nearly a decade, ranking second behind Toyota for the whole year.

Volkswagen said that the COVID-19 epidemic in 2020 and the partial suspension of production due to lack of chips led to a star decline in the group's sales in the second quarter, but the company rebounded strongly in the fourth quarter, even exceeding the delivery volume in the third quarter. To help the group achieve a stable turnover for the whole year.

Especially as its largest single market, the rapid recovery of the Chinese market. According to data, Volkswagen sold a total of 3.85 million vehicles in China, accounting for 19.3% of the Chinese market and 41.4% of Volkswagen. Among them, FAW-Volkswagen Volkswagen brand, Audi brand and Jetta brand accumulated sales of more than 2 million vehicles, while SAIC-Volkswagen sales of about 1.505 million new cars helped Volkswagen Group sales back.

Frank Vettel, a member of the board of directors of Volkswagen Group, said that although the epidemic brought unprecedented challenges to the group, Volkswagen Group succeeded in controlling the negative impact of the epidemic on its business last year. At the same time, the group has also achieved effective transformation.

Data show that Volkswagen accounted for a small proportion of sales in the electrification sector in 2020. However, in terms of pure electric vehicle sales, sales have increased by 214 per cent, from 73700 to 232000, laying the strategic foundation for Volkswagen's transformation.

However, 2021 is still full of challenges for Volkswagen. Volkswagen has shut down or cut production at several factories since it entered 2021 due to a shortage of automotive chips, including the best-selling Chinese market. In addition to the huge capital cost required to further roll out new energy vehicles, Volkswagen will still face a fine of more than 100 million euros for failing to meet the EU's carbon dioxide emissions targets for passenger cars; to sum up, 2021 will still have a lot of pressure and resistance for Volkswagen.

In response, there are also reports that there is pressure for more money. Reuters reported that Volkswagen Group is considering a separate listing of its Porsche brand. This is also the news that another Volkswagen brand has been or will be split and listed after Lamborghini.

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