Volkswagen Group missed its cash-flow goal for 2022 after supply-chain and logistics disruptions in latest months left the corporate with unsold autos.
The automaker reported preliminary money circulation of round 5 billion euros ($5.36 billion) for 2022, falling nicely under its goal of round 8.6 billion euros, based on a preliminary earnings assertion late Tuesday.
VW’s issues are much like these of different carmakers which have seen unsold completed items and uncooked supplies piling up.
Stellantis stated in November that freight issues throughout the automotive business similar to railcar, truck and driver shortages, and ship availability had been making it arduous to get vehicles to sellers.
“VW is not alone in facing logistics challenges related to getting finished inventories to dealers at year end,” RBC analyst Tom Narayan wrote in a be aware. “Our channel checks counsel this was a standard difficulty” amongst European carmakers.
Still, the missed money goal is a blow to VW Group CEO Oliver Blume, who took over from ousted CEO Herbert Diess in September with targets together with enhancements to planning after VW was worse hit than many friends by the extreme semiconductor shortages.
VW expects the logistics issues to ease this 12 months.
Price pressures
VW Group’s deliveries had been up 12 p.c within the second half of 2022, it reported in January, however full-year deliveries had been the bottom in over a decade as COVID-19 lockdowns in China and the struggle in Ukraine upended provide chains.
Chief Financial Officer Arno Antlitz stated in October that the automaker had 150,000 unfinished autos in its stock and the corporate was stocking up on provides to guard in opposition to additional shortages, pushing up costs and slicing prices to make up for decrease unit gross sales.
VW’s full order books in Europe will assist gross sales via the primary half of the 12 months, Antlitz stated, however as extra vehicles go on sale, it’ll even be harder to cross on elevated prices from greater enter costs.
Automakers are struggling to extend output as they transition to electrical autos and take care of weakening demand and inflation.
Concerns are rising that client urge for food for brand new vehicles is dwindling, main to cost reductions from Tesla and Ford Motor and a forecast from Robert Bosch that automotive manufacturing won’t attain pre-pandemic ranges this 12 months.
VW Group will publish its full-year earnings and annual report on March 14.
Preliminary earnings of twenty-two.5 billion euros in 2022. which VW launched on Tuesday, put the corporate on the greater finish of the 7 p.c to eight.5 p.c margin it had forecast, with gross sales of round 279 billion euros in contrast with 250 billion in 2021.
Reuters contributed to this report
Source: europe.autonews.com