Volkswagen earned $ 12 billion in 2020, despite pandemic

Volkswagen earned $ 12 billion in 2020, despite pandemic

by
The world’s largest carmaker said in a statement on Friday that it expects operating profit of € 10 billion ($ 12.2 billion) for 2020. an achievement helped by a strong finish of the year.
Following the loss of € 1.4 billion ($ 1.7 billion) in the first six months of 2020, Volkswagen (VLKAF) “proved quite strong in the second half,” he added. The deliveries in the fourth quarter ‘recovered strongly’ and surpassed the previous three months.

Volkswagen made almost twice as much money in 2019 and made a profit of € 19.3 billion ($ 23.5 billion) on sales of € 252 billion ($ 306.6 billion). But shares in the company jumped to 6% in Frankfurt on Friday, suggesting investors would expect an even further drop in earnings.

In the first months of the pandemic, car manufacturers experienced a collapse in sales and disruptions in the supply chains. They now have a critical shortage of semiconductors that threatens production just when the industry is trying to return.

Volkswagen had to adjust its quarterly production in China, North America and Europe and could lose 100,000 units, or about 4% of global quarterly production, according to UBS analysts.

The German carmaker, which also owns the Audi and Porsche brands, said last week that it had ‘slightly expanded’ its share of the global passenger car market by 2020. It delivered 9.3 million vehicles, a drop from 15.2% compared to 2019. Deliveries held better in China, its single largest market, by 9% compared to a 20% slump in Europe.

The delivery of battery-electric vehicles reaches 231,600, more than three times the volume in 2019. Plug-in hybrid deliveries increased by 175% to 190,500 units.

It appears that traditional car manufacturers ‘can manage the transition to electric mobility much better than feared’, Bernstein senior analyst Arndt Ellinghorst said in a note to customers on Friday. “Investors need to wake up to the excessively low valuation of traditional car manufacturers, especially in the context of valuation for all that ‘new mobility’ is,” he added.

Despite producing only 500,000 vehicles by 2020, he is a leader in electric cars Tesla (TSLA) is worth $ 800 billion, eight times Volkswagen’s market capitalization.
In his very first tweet this week, and perhaps as a sign of increasing confidence in the German industrial giant, Volkswagen CEO Herbert Diess said the company had pushed in electric vehicles, noting Tesla CEO Elon Musk.

.Source