Returns at Volkswagen AG’s Porsche unit rose last year, dwarfing its namesake passenger car brand, to bolster the German automaker’s plan for a listing of the maker of the iconic sports car.
Porsche reported an operating margin of 16.5 percent last year, up from 15.4 percent, Europe’s biggest automaker said yesterday.
For Volkswagen’s main mass-market brand, the measure recovered to 3.3 percent, excluding returns from the highly profitable Chinese venture.
Photo: Reuters
Volkswagen is pushing ahead with plans for an initial public offering (IPO) in the fourth quarter, against a backdrop of highly volatile global markets limiting investor appetite.
Volkswagen expects group returns to be in line with last year’s result, the automaker said last week, adding that the outlook might worsen due to unpredictable fallout from Russia’s invasion of Ukraine.
The automaker said it expects moderately higher global passenger car sales for this year, but that deliveries would stay below levels seen before the COVID-19 pandemic.
The view assumes shortages of semiconductors and commodities to “become less intense,” Volkswagen said in its annual report.
As automakers pursue broad rollouts of electric vehicle (EV) models, volatile raw material and energy prices are adding pressure.
Russia is a key exporter of numerous inputs, including nickel and palladium, while passing on higher costs to consumers is limited.
Vehicle prices have rocketed as the chip shortage idled plants amid robust vehicle demand. Disruption from the war in Ukraine has more recently forced Volkswagen to shut plants.
The Porsche IPO is part of a deeper overhaul at Volkswagen to accelerate the industry’s biggest EV rollout, which has gotten off to a bumpy start amid the COVID-19 pandemic and crippling chip shortage.
This month, the firm finalized plans for a new 2 billion euro (US$2.2 billion) factory close to its sprawling headquarters in Wolfsburg, the same day that Tesla Inc received a long-awaited approval to start its first European plant near Berlin.
The listing would see a stake of as much as 25 percent of preferred shares, which do not carry voting rights, sold to investors.
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