Leading the Transformation - Unicredit Automotive Credit Conference 22-23 June 2022 - Volkswagen AG
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Leading the Transformation. Unicredit Automotive Credit Conference 22-23 June 2022
Disclaimer
The following presentations as well as remarks/comments and explanations in this context contain forward-looking statements on the business
development of the Volkswagen Group. These statements are based on assumptions relating to the development of the economic, political and
legal environment in individual countries, economic regions and markets, and in particular for the automotive industry, which we have made on the
basis of the information available to us and which we consider to be realistic at the time of going to press. The estimates given entail a degree of
risk, and actual developments may differ from those forecast.
At the time of preparing these presentations, it is not yet possible to conclusively assess the specific effects of the latest developments in the Russia-
Ukraine conflict on the Volkswagen Group’s business, nor is it possible to predict with sufficient certainty to what extent further escalation of the
Russia-Ukraine conflict will impact on the global economy and growth in the industry in fiscal year 2022.
Any changes in significant parameters relating to our key sales markets, or any significant shifts in exchange rates, energy and other commodities or
commodities relevant to the Volkswagen Group or the supply with parts, or deviations in the actual effects of the Covid-19 pandemic from the
scenario presented will have a corresponding effect on the development of our business. In addition, there may be departures from our expected
business development if the assessments of the factors influencing sustainable value enhancement and of risks and opportunities presented
develop in a way other than we are currently expecting, or if additional risks and opportunities or other factors emerge that affect the development
of our business.
We do not update forward-looking statements retrospectively. Such statements are valid on the date of publication and can be superseded.
This information does not constitute an offer to exchange or sell or an offer to exchange or buy any securities.
2
Leading the Transformation. Sales Review Q1 2022
Development World Car Market vs. Volkswagen Group Car Deliveries to Customers by Regions1
January to May 2022 vs. 2021
North America2 Europe China
Car Market VW Group Car Market VW Group Car Market VW Group
-14.1%
-12.7%
-17.6% -17.9%
-23.6%
-28.4% -28.5%
South America2 World2 Rest of the World
Car Market VW Group Car Market VW Group Car Market VW Group
-4.7% -1.0%
-12.1%
-14.1%
-39.6% -26.3%
1 Volkswagen Group Passenger Cars excl. Ducati and TRATON; 2 incl. VW LCV in North America & South America
4
Volkswagen Group – Deliveries to Customers by Brands 1
January to May 2022 vs. 2021
[thd. veh.]
January – May 2021
-25.5%
January – May 2022
4,122
Volume Premium Sport & Truck &
-28.0% -22.5% Luxury Bus
-8.6% +5.8%
3,073
-27.9%
2,259
1,628
-22.8%
-30.8% 805
-27.2% -23.4% 622 -8.6% +5.8%
425 +3.5% +3.6%
295 225 164 166 127 128 117 105 111
4 4 6 6
Volkswagen Nutzfahrzeuge
1 Excl. Ducati
5
Leading the Transformation. Key Financials Q1 2022
Solid Trend despite Lower Vehicle Sales are Testimony to our Robust Business Model
January to March 2019 vs. 2021 vs. 2022
Vehicles Sales Sales Revenue Operating Profit 1 and Margin
[m vehicles] [€ bn] [€ bn] Margin [%]
+5%
8.1% 7.7% 13.5%
62.4 62.7
60.0
8.5
3.5
-23% 4.8 4.8
2.583 2.334
1.995
4.7 4.3 5.0
Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1
2019 2021 2022 2019 2021 2022 2019 2021 2022
Positive fair value measurements on
hedging instruments outside hedge accounting
included in other operating result
1 before special items
7
Solid Margins in all Divisions
January to March 2019 vs. 2021 vs. 2022
Automotive Division Financial Services Division
Passenger Cars 1, 2 Commercial Vehicles3) Financial Services
EBIT [€ bn] EBIT [€ bn] EBIT [€ bn]
incl. Margin [%] incl. Margin [%] incl. Margin [%]
8.7% 8.5% 15.5% 6.7% 1.5% 4.0% 7.6% 9.3% 13.3%
6.5
3.8 3.8
1.5
1.0
0.4 0.7
0.3
0.1
Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1
2019 2021 2022 2019 2021 2022 2019 2021 2022
1 beforespecial items
2 Passenger Cars = Automotive Division ./. Commercial Vehicles, Power Engineering
3 TRATON excluding Financial Services 8
Automotive Clean Net Cash in Q1 impacted by negative Changes in Working Capital;
January to March 2019 vs. 2021 vs. 2022
'Clean' Net Cash Flow 1, 2 Reported Net Cash Flow 1 Net Liquidity 1
[€ bn] [€ bn] [€ bn]
31.1
29.7
16.0
5.5
4.7
2.5 2.2 2.0 1.5
Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1
2019 2021 2022 2019 2021 2022 2019 2021 2022
1 Automotive Division
2 Reported net cash flow before M&A and Diesel payments
9
Net Liquidity Bridge and Cash Flow Automotive Division
Solid Clean Net Cash Flow and DCM Activity drive Net Liquidity Position
Cash outflow from change in WC mainly
[€ bn] related to supply chain disruptions: €1.6
-2.1
-0.3
2.5 -1.7
-1.7
7.4 1.7
-2.2
0.3 -0.5 1.1
-0.2 31.1
Reported Net Cash flow (€ 1.5bn)
26.7
Clean Net Cash flow (€ 2.2bn)
M&A
31.03.2022
31.12.2021
Change
in receivables
Development cost
Change
Gross Cash Flow
in inventories
Net Liquidity
within working capital
Capex
activated
other
Net Liqudity
in payables
Change
Hybrid Capital
Other changes
Diesel
other
10Leading the Transformation. Financing the Transformation
Financing the Transformation: Overhead Cost Program ahead of Schedule;
so far allowing for compensation of Fix Cost Increase1
Group wide Overhead Cost Program (w/o R&D, CAPEX), Deliveries to customers
[in m units]
11 +5-10%
8.9
Plant program
(Productivity & Overhead)
[€ bn]
~ -10%
Working capital management / 41.4
cashflow orientation
37.5
Level Freeze
Purchasing program
Overhead cost
(w/o R&D, Capex) 2
9.3 9.5
Q1
Pricing & other sales costs 2019 2021 2022E Target
optimization 2023
1 All figures shown are rounded, minor discrepancies may arise from addition of these amounts
2 Thereof Passenger Cars €+ 0.1 bn y–o-y; Automotive Division €-0.2 bn y-o-y (Navistar not yet consolidated in Q1/21)
12Increase in R&D especially for Software compensated by CAPEX Discipline
R&D / Capex – Absolute and Ratio (Automotive Division)
[%, €] CAPEX R&D
Reducing complexity /
variances
∑ 13.3%
14 ∑ 12.7%
(€ 28.3 bn)
(€ 26.1 bn) ∑ 11.8% ∑ 12.5%
(€ 6.1 bn)
12
Focus on synergies
~5.1% ~3.3%
10 ~6.6%
(€ 14.0 bn) (€ 10.5 bn) (€1.7 bn) ~5.5%
8
Multi brand production
in MQB plants 6
~8.5%
4 ~7.6%
~6.7% (€4.4 bn) ~7.0%
(€ 15.6 bn)
(€ 14.3 bn)
Investment in software 2
0
2019 2021 Q1 2022 2022e
13CARIAD business model – Software is the key differentiator for the future, scale is key
E³E³1.1
1.1
ID. family E³ 1.2
PPE platform SOFTWARE STACK
(Audi, Porsche)
E³ 2.0 Group-wide roll-out
Q1 2022: Artemis Trinity
Employees: 4,900
Revenues: €0.110 bn
R&D: - €0.996 bn
Op. Profit: - €0.416 bn
BREAK-EVEN
AFTER 2025
- 1.5 - 2.6
>3.0 1
[Cash Flows in € bn] Expected
INCOME PHASE
2020 2021 2022 2023 INVESTMENT PHASE
THROUGH LICENSES
Schematic overview 1 IP transfer included in brand groups since Q1 2022 14Automotive new car revenue pools are expected to shift fundamentally due to new
technologies
Today 2025E 2030E
ICE
revenues
EV
revenues
Software-
enabled
revenues
∑ Total >2 >3 >5
Values in € trillion
Schematic overview based on internal and external analysis
15PR 70 Focus on the future – Investments in R&D and Capex 2022-2026
Significant investments planned for a successful transformation of the business
EUR billions
~89
(56%)
~73
(50%) ~30 Software/
(19%) Digital technology
~59
(40%) ~27
~14 (18%) ~8 (5%) Hybrid powertrains
~44
(30%) (10%)
~12 ~11
~8 (5%)
(9%) (7%)
~4 (3%)
~52
BEV’s/Electrification
(33%)
~32 ~33 ~35
(21%) (23%) (24%)
PR 67 PR 68 PR 69 PR 70
16Robust business case
2023 2025/26
2019 2020 2021 Interim Strategic
Key financial targets Actual Actual Actual Strategic Targets Targets
Operating return on sales 7.6 4.8 8.0 7-9 8-9
before Special Items
Return on investment
Automotive Division 12.6 7.1 10.8 ~14 >15
before Special Items Percent
Capex ratio 6.6 6.1 5.1 ~6 ~5
Automotive Division
R&D cost ratio 6.7 8.0 7.6 ~6.5 ~6
Automotive Division
a) Clean Net Cashflow
Cash Automotive Division 13.5 10.0 15.5 13-15 >15
EUR
Automotive w/o Diesel and M&A
billions
Division
b) Net Liquidity 21.3 26.8 26.7 ~10% of Group sales revenue
17Leading the Transformation. Outlook 2022
Volkswagen Group – Outlook for 2022 1 confirmed
Actual Outlook
2020 2021 2022 1
5% to 10% up on the previous year
Deliveries to customers 9.3 8.9
m vehicles
250.2 8% to 13% higher than the prior-year figure
Sales revenue 222.9
€ billion
Operating return on In the range of 7.0% to 8.5%
4.8
2 8.0 2
sales
%
Automotive 10.0 15.5 In the range of 13 – 15 bn €
Clean Net Cash flow € billion
Automotive 6.4 8.6 Same level as in the previous year 3
Reported Net Cash flow € billion
Automotive Up to 15% higher than prior-year figure
26.8 26.7
Net Liquidity
€ billion
1 it is not yet possible to conclusively assess the specific effects of the latest developments in the Russia-Ukraine conflict on the Volkswagen Group’s business, nor is it possible to predict with sufficient
certainty to what extent further escalation of the Russia-Ukraine conflict will impact on the global economy and growth in the industry in fiscal year 2022
2 before special items
3 including any cash outflows in connection with the EU antitrust proceedings against Scania 19Leading the Transformation. New Auto Strategy
New Auto Strategy: We will Shift the Focus towards Brand Groups and Value
Drivers
Schematic
Strong Combination Separate Listing
Strong brands Volume Premium Sports Trucks +
Strong positioning of
China JVs as unique
Value drivers
assets
BEV Hardware
Open for partnerships and
third party business
Software
Battery & Focus on technology /
Charging software roadmap and
mobility services
Mobility
Solutions
Tech. Components
Group Services/
Financial Services
Customers, brand positioning, performance programs,
synergies, delivery
21Variants are reducing complexity along the converging path towards a Group mechatronics
platform – SSP (Scalable Systems Platform)
3x 2x 1x
Key enabler for future
MQB
MEB
E³ 1.1
technologies e.g. AD
Group mechatronics platform
SSP E3 2.0
MSB
PPE
E³ 1.2
MLB
platform flexible ICE flexible BEV Group mechatronics platform
principle mechatronics platform mechatronics platform
22Volkswagen Groups' ambition – keeping the relative scale with MQB
Declining demand for ICE
Tightening emissions
regulations Tax
ICE (e.g. EU7) disadvantages
Margin
2025/
2030
ICE complexity reduction Product substance MQB MQB - scale
(models, EU) 2nd hardware life cycle Factory utilization
minimal additional structural to bundle production of multi-
~ -60%
funding brand ICEs
MQB
MQB
2021 2030
23Operating Margin Parity in Western Europe between BEV and ICE progressing
Margin parity might
be reached earlier
ICE Margin
Lower factory
costs thanks to
Increasing multi-brand
BEV Margin economies factories
of scale
Battery cost
Lower R&D thanks savings
to shared platform
Today and Group
synergies
Volkswagen Tiguan TSI OPF 180 kW (245 PS): Fuel consumption combined: 7.2 l/100km (NEDC), CO2 emissions combined: 164 g/km, CO2 efficiency class: C
Volkswagen ID.4: Power consumption combined: 16.3-15.6 kWh/100km (NEDC), CO2 emissions combined: 0g/km, CO2 efficiency class: A+++ 24NEW AUTO strategy: Towards a Vertically Integrated Mobility Company
Volume Premium Sport
Mechatronics SSP
Software
Battery &
Charging
Mobility &
Services
25Levers for value creation: Execution of transformation
Performance
KPI driven
short/mid-term
• Strong brands in regions
New Auto
• Margin management
↑ Market capitalization
• Cost reduction
• Economies of scale
Value
• Investment efficiencies
/ synergies
• Complexity reduction
• Pricing power
• Cash generation Market capitalization
• Working capital ~86 € bn1)
management
• Strong technological platforms Transformation to
• New business models Mobility Tech Company
• New profit pools
longer term
1 Status 09/05/2022
26Increasing the footprint in North America
Ambition
raise Group’s overall market share in the US to 10% by 2030 and
grow sustainable and profitable
Electrification as an opportunity to enter also new segments
>25 new BEV models by 2030 (US)
the iconic US brand Scout will be electrified
start of production in 2026 targeted
1 Vehicles sold outside Germany.
27China Joint Ventures – Proportionate Operating Profit
[€ m]
3,602
FY
3,026
Q1
661 824
276
2020 2021 2022E
Drivers
• Continued impacts from semi supply bottlenecks and COVID related production disruptions towards the end of the 1st quarter
• Continued strong premium performance, performance of SAIC Volkswagen improved YoY
• SAIC Audi started production, thereby strengthening the local footprint
• Production catch-up program initiated
28Das Bild kann nicht angezeigt werden.
Enable NEV growth plan with ambitious ramp-up of battery and production capacity
[in thousands] NEV production capacity is expected to be ramped
up to > 1.0 mn by 2025
Continuously growing battery cell demand
Changchun
(600)
Partnering with Gotion High-Tech
Shanghai
(300)
Ongoing cooperation with local suppliers
Hefei
(300)
Foshan
(300) Staggered approach to build up partnerships
FAW-VW VW Anhui
SAIC VW Audi FAW NEV (PPE) Continuous supplier qualification accordingly to
Volkswagen standards
29Leading
Leading the
the Transformation.
Transformation.
Strategy – Software-enabled car company
BEV Strategy and ChargingBEV ramp up – Striving for Scale Effects
2021, Q1 2022 and Outlook
2021 2022E
BEV Share [%]; BEV Deliveries [‘000 units] 5.1% 7-8%
8.3%
6.2%
5.2%
4.4%
2.5%
60 111 122 160 99 453
Q1 21 Q2 21 Q3 21 Q4 21 Q1 22 2021 2022E
Volkswagen ID.5: Vehicle is a near-production concept car
Audi Q4 e-tron: Power consumption combined: 18.3–15.2 kWh/100 km (NEDC), CO2 emissions combined: 0g/km, CO2 efficiency class: A+++
Porsche Taycan GTS Sport Turismo: Power consumption combined: 26.0 kWh/100km (NEDC), CO2 emissions combined: 0g/km, CO2 efficiency class: A+++
31Targeting BEV Podium Position by 2025
BEV Share of Total Vehicle Sales in %
Q6 e-tron BEV
ID. BUZZ
ID.5
e-Macan
+… x2
≈50%
RoW
Q5 e-tron
(China) NAR
ID.4 (US) China
Europe
x2 ≈25%
≈20%
x2
Thereof:
Europe: 68.5% ≈11%
China: 20.5% ≈7-8%
USA: 8.2% 5.1%
2021 2022e 2023e 2025e 2026e 2030e
Volkswagen ID.Buzz/ID.5: Vehicles are near-production concept cars
Volkswagen ID.4: Power consumption combined: 16.3-15.6 kWh/100km (NEDC), CO2 emissions combined: 0g/km, CO2 efficiency class: A+++
32
Audi Q5 e-tron: Vehicle sold outside GermanyBEV starts to scale, already > one million production capacity in 2023
USA Europe China
Emden Wolfsburg
from 2022
from 2026 Changchun
Hanover
from 2022 Leipzig Wrzesnia
from 2022
Brüssel
Dresden
Chattanooga Zwickau Anhui
from 2024
Anting
from 2022 Neckarsulm Mlada Boleslav
Changsha
Zuffenhausen from 2024
Ingolstadt
from 2023
Bratislava
Foshan
VW ID.3 VW ID.4 AU Q4 e.tron VW ID.3 (CN) VW ID.4 (CN)
VW ID.4 (NAR)
VW ID. BUZZ VW Trinity CU Born VW ID.6 (CN) VW ID.6 X (CN)
Skoda Enyaq VW ID.5 PO Taycan CU Tavascan (CN) AU e-tron (CN)
Volkswagen ID.3: Power consumption combined: 14.0 -13.7 kWh/100km (NEDC), CO2 emissions combined: 0g/km, CO2 efficiency class: A+++ Cupra Born: Power consumption combined: 17.6 kWh/100km (NEDC), CO2 emissions combined: 0g/km, CO2 efficiency class: A+++
Volkswagen ID.4: Power consumption combined: 16.3 -15.6 kWh/100km (NEDC), CO2 emissions combined: 0g/km, CO2 efficiency class: A+++ Skoda Enyaq: Power consumption combined: 13.6 kWh/100km (NEDC), CO2 emissions combined: 0g/km, CO2 efficiency class: A+++
Audi Q4 e-tron: Power consumption combined: 18.3 - 15.2 kWh/100 km (NEDC), CO2 emissions combined: 0g/km, CO2 efficiency class: A+++ Porsche Taycan: Power consumption combined: 23.9 - 19.6 kWh/100km (NEDC), CO2 emissions combined: 0g/km, CO2 efficiency class: A+++
Volkswagen ID.Buzz/ID.5: Vehicles are near-production concept cars 33Principle of Closed Loop Battery Materials
Primary raw Material
(chemistry part) Cathode-material
Secondary Material 9 10
(reusable for new cell
production)
Cell-
Hydrometal. Recycling 1
8 production
(chemistry involved) (cell modules)
Systemproduction
Mechanical Recycling 7 2
(battery system)
• We are striving for high recovery rates of
Raw Material (Nickel, Cobalt,
Manganese, Lithium)
Remanufacturing/2nd Life 6 • For this reason, a pilot plant for battery 3 1st Life
(in mobile power-banks) recycling is currently being set up at the
Salzgitter factory, Germany.
classification of battery health 5 Return (of battery)
4
status
(to extend lifecycle in car use) Open market
34Volkswagen Group’s Unified Cell: The intelligence is inside
One format
Every state of the art
chemistry
35Volkswagen demand Europe: 240 GWh means 6 Gigafactories by 2030
Sweden
Skelleftea
DECIDED LOCATIONS Northvolt plant
Germany
Salzgitter
Spain 4 5 6
VALENCIA Open locations
36The standard factory concept: Scalable, standardized modules with a production capacity of
40 GWh1 per year
3D VISUALIZATION OF TWO STANDARD FACTORY MODULES (2X22 MILLION CELLS PER YEAR)
~750m
~400m
BENEFITS OF THE STANDARD FACTORY CONCEPT
EUROPEAN STANDARD LEAN LINE DESIGN FLEXIBLE PRODUCTION FOOTPRINT
Standardized Factory design follows Adaptable to different cell
European factory to value stream concept from chemistries and formats
minimize planning mixing to final inspection
efforts
1) 40 GWh per year using the example of Salzgitter (2 standardized modules)
37Building up competences upstream the value chain to expand the profit margin and exploit new
revenue stream
Tier 5 Tier 4 Tier 3 Tier 2 Tier 1 OEM
Battery Battery
Equipment Raw material Battery cell Vehicle
module integration
Traditional
automotive
Vertical Vertical Vertical
integration 3.0 integration 2.0 integration 1.0
Automotive
industry 5.0 Q4 2022 Dec 2021 Mar 2021
Joint venture for VW and Umicore Power Day
European battery supply cathode and Technology roadmap
equipm. manufact. precursor material and charging by 2030
38Volkswagen Group’s High Performance Charging Boost Program is covering the most
important e-mobility markets
18.000
HPC points
10.000
HPC points 17.000
HPC points
45.000
HPC points worldwide
39Leading the Transformation. Mobility Partnerships
Volkswagen and Ford: Alliance delivers significant strategic and economic benefits
Collaboration Projects
VEHICLE VW TO SUPPLY
DEVELOPMENT & MEB PLATFORM PROJECTS IN
PRODUCTION
PICKUP, CITY VAN,
TO FORD AUTONOMOUS
ONE-TON VAN
(MODULAR ELECTRIC DRIVING WITH
TOOLKIT)
Production of up to 8m units of the 1.2m MEB platforms and Collaboration with Argo AI aims for
three commercial vehicles targeted; associated components (battery industry leading autonomous
SOP of the first project since systems) delivered by VW vehicle technology for Mobility and
February 2022 starting 2023 Transport as a Service solutions.
Through the cooperation, synergies
in investments, purchasing and >$20bn deal value New customers, new business
capacity utilization fields in AD transportation market
41Europcar deal provides compelling opportunity to create a leading mobility platform
Consortium of Accelerated delivery of mobility services targets
• Customers increasingly demand new and
innovative on-demand mobility solutions, such
as subscription and sharing models
Interaction at
Green Mobility Holding
“arms’ length” • Building a leading mobility platform is a key
priority of NEW AUTO strategy through 2030
Offer price will increase to €0.51
if acceptance of >90% reached
€0.50 per share (2nd tender offer from June 16 to 29, • Leveraging the strong transformation
2022)
capabilities of Attestor as well as the
international mobility services and customer
• Leading market position experience of Pon
• Advanced fleet • Develop and transform Europcar’s business
management capabilities and selectively add further services from
• Broad network of stations Volkswagen Group brands
42Leading the Transformation. Funding
Volkswagen Financial Services 1): global, well diversified and successful
Strong global presence Continuous portfolio expansion
in ‘000 contracts
10.297 10.580 11.111 11.283
7.641 7.717
6.322
7.218 Total
Portfolio
4.616 4.692
2.760 3.921 4.149 4.770 4.816 22.099
2.518
5.833 6.155 5.672 5.935 6.585 6.635 6.151 6.000
2015 2016 2017 * 2018 2019 ** 2020 2021 Q1 2022
Financing Leasing Insurance / Services
*) Reclassification Finance / Lease contracts **) contracts from international JVs included
Rising penetration rates (without China) Diversified funding structure
Bonds,
Commercial Paper, 49%
51%
49% 49%
49% 49% liabilities to financial
49%
48% institutions
47% 15%
Customer deposits
23%
13%
Asset backed securitization Liabilities to
affiliated companies
31.03.2022 € 182.4 bn
1) Excl. activities of Scania, Navistar and Porsche Holding Salzburg; incl. Financial Services of Porsche AG and MAN Financial Services.
44Volkswagen Group – Well Diversified Funding Mix totaling €226bn
as of March 31, 2022
2/3 1/3
45Volkswagen Group Funding – CM Borrowings Diversification of unsecured funding
as of March 31, 2022
46Volkswagen Group Funding – Bond Maturity Profile (including CPs)
as of March 31, 2022
0-3y: 55.7bn (52%) 4-6y: 29.2bn (27%) >6y: 22.3bn (21%)
(June 22 to May 23)
47Volkswagen Group – Second Green Bond
Deal Review
Volkswagen is committed to complying with the United Nations’
Summary of Terms and Conditions
Paris Agreement. The goal is to become a company with a carbon- Pricing / Settlement 21 June 2022 / 28 June 2022
neutral footprint by 2050. As early as by 2025, the Group plans to
Tranche EUR 2.75yrs Fixed EUR 5.25yrs Fixed
reduce the total life-cycle greenhouse gas emissions from passenger
cars and light commercial vehicles by 30% compared to 2015. In Size EUR 750m EUR 750m
addition, the Group has set a decarbonization target confirmed by
Coupon 3.125%, annual 3.75%, annual
the Science Based Targets initiative (SBTi), which envisages a
reduction of 30% from 2018 to 2030 without offsetting. SBTi Final Spread EUR MS +115bps EUR MS +155bps
confirmed in April 2022 after a scientific review that Volkswagen
Group’s new scope 1 and 2 emissions reduction targets are aligned Re-offer price 99.939% 99.546%
with the ambition to limit global warming to 1.5 degrees. Use of Proceeds Funds to be used for the modular electric drive
matrix (MEB) and the BEV models ID.31 and ID.42
The Volkswagen Group believes that Green Debt Instruments are
External Review Certified by the Climate Bonds Initiative (CBI)
effective tools to channel investments to projects that have
demonstrated climate benefits and thereby contribute to the
achievement of the Paris Climate Agreement and the United
Nations’ Sustainable Development Goals (“UN SDGs”). 1ID.3 - ID.3 Electricity consumption combined 15.4 - 14.5 kWh/100 km; CO₂ emissions combined 0g/km, efficiency class: A+
2ID.4 – Electricity consumption combined 16.9-15.5 kWh/100 km; CO₂ emissions combined 0g/km, efficiency class: A+
48Long Term Rating Volkswagen Group
as of 14.06.2022
Aaa AAA
Aa1 AA+
Aa2 AA
Investment grade
Investment grade
Aa3 AA-
A1 A+
A2 A
A3 VW AG (S), VW FS AG (S), VW Bank (S) 1) A-
Baa1 BBB+ VW AG (S), VW FS AG (S), VW Bank (S)
Baa2 TRATON (S) BBB TRATON (S)
Baa3 BBB-
Ba1 BB+
Subinvestment grade
Ba2 BB
Subinvestment
Ba3 BB-
grade
B1 B+
B2 B
B3 B-
--- ---
Outlook: (P)ositive, (S)table, (N)egative, RfD = Rating under review for Downgrade, RfU = Rating under review for Upgrade
1) Moody‘s unsecured debt rating for Volkswagen Bank GmbH; Deposit and issuer ratings: A1 (stable) 49Leading the Transformation. ESG, Integrity & Compliance
Decarbonization, Circular Economy, Responsibility in Supply Chain & Business, Diversity,
People & Transformation and Integrity are our ESG focus areas.
IMPROVE ESG Performance
Decarbonization Circular Economy Responsibility in Supply Chain & Business
Diversity & Inclusion People in the Transformation Integrity
Orientation Reputation Value-Driver Transformation
51Investor Relations Team
We are pleased to answer your inquiries regarding Volkswagen shares and other capital market related
questions.
Rolf Woller (Wolfsburg Office) Helen Beckermann (Wolfsburg Office) Julian Krell (Wolfsburg Office)
Head of Group Treasury & Investor Relations Head of Group Investor Relations Deputy Head of Group Investor Relations
E-Mail: rolf.woller@volkswagen.de E-Mail: helen.beckermann@volkswagen.de E-Mail: julian.krell@volkswagen.de
Telephone: + 49 5361 9 24184 Telephone: +49 5361 9 49015 Telephone: + 49 5361 9 13257
Alexander Hunger (Wolfsburg Office) Ulrich Hauswaldt (Wolfsburg Office) Andreas Buchta (Wolfsburg Office)
Investor Relations Manager Investor Relations Manager Investor Relations Manager
Equity & ESG Equity, Debt & ESG Equity & Key Contact North America
E-Mail: alexander.hunger@volkswagen.de E-Mail: ulrich.hauswaldt@volkswagen.de E-Mail: andreas.buchta@volkswagen.de
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Investor Relations Manager Investor Relations Manager Investor Relations Manager
Equity Equity Equity & Key Contact China/Asia-Pacific
E-Mail: monika.duehring@volkswagen.de E-Mail: bjoern-michael.piesch@volkswagen.de E-Mail: lai.wang@volkswagen.com.cn
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The official website of Volkswagen Group Investor Relations. Company topics, brandchannels, innovation and informations.
52Leading the Transformation. Appendix
Passenger Car (PC) and Light Commercial Vehicles (LCV) Sales according to EU Taxonomy
already above 10% of total Sales 1
January to December 2021
Sales in % according to EU Taxonomy Sales Revenues PC and LCV according to EU Taxonomy
[%] [€ bn]
34.4%
89.4% 10.6% 229.0 250.2 21.2
65.6% (91.5%) (8.5%)
Conventional
Electrified EU taxonomy - aligned (CO2 < 50g/km)
BEV EU taxonomy - aligned (CO2 < 50g/km) not EU taxonomy - aligned
PHEV
1 excluding Chinese Joint Ventures
54Capital Expenditure according to EU Taxonomy – Passenger Cars (PC) and Light Commercial
Vehicles (LCV)
January to December 2021
[€ bn] Taxonomy - aligned Capital Expenditure for BEV only
3.8
3.5
39.9 14.2
54.0
(73.8%) (26.2%)
Property, Plant Capitalized
& Equipment Development Costs
EU taxonomy - aligned (CO2 < 50g/km) 1
not EU taxonomy - aligned
1 Capital expenditure for BEV und PHEV (CO2 < 50g/km)
55Leading the Transformation. Shareholder Structure
The Shareholder Structure, Supervisory and Management Board
Shareholder Structure of Volkswagen AG Supervisory Board of Volkswagen AG Board of Management of Volkswagen AG1)
Number of Outstanding Shares Chairman Hans Dieter Pötsch Chairman of the Board
of Management of Dr. Herbert Diess
Preferred shares Members Mansoor Ebrahim Al-Mahmoud Volkswagen AG
206,205,445 Dr. Hessa Sultan Al Jaber
41.1% Procurement Murat Aksel
Dr. Bernd Althusmann
58.9% Finance Dr. Arno Antlitz
Daniela Cavallo
Mathías Carnero Brand Group ‘Luxury’ Oliver Blume
Ordinary shares Marianne Heiß
295,089,818 Chief Executive Officer
Dr. Arno Homburg of the Volkswagen Ralf Brandstätter
Jörg Hofmann Passenger Cars brand
Current Voting Rights Distribution Dr. Louise Kiesling
Integrity and Legal
Others Simone Mahler Dr. Manfred Döss
Affairs
9.7% Peter Mosch
Qatar Holding Brand Group ‘Premium’ Markus Duesmann
Daniela Nowak
17.0%
Dr. jur. Hans Michel Piëch Human Resources
53.3% Porsche SE, Gunnar Kilian
Stuttgart Dr. jur. Ferdinand Oliver Porsche and Truck & Bus
20.0%
Dr. rer. comm. Wolfgang Porsche Thomas Schmall-von
Technology
Jens Rothe Westenholt
State of Lower IT Hauke Stars
Conny Schönhardt
Saxony, Hanover
Stephan Weil Hildegard
(as at December 31, 2021) Sales
Werner Weresch Wortmann
1) EachBoard Member is responsible for one or more functions within the Volkswagen Group. The work of the Board of Management of Volkswagen AG is supported by the boards of the brands and regions as well as by the other group business 57
units and holdings.The Key to Mobility Creating Value with Volkswagen Financial Services Investor Update Volkswagen Financial Services AG and Volkswagen Bank GmbH Unicredit Automotive Credit Conference, 22 - 23 June 2022
Disclaimer
The following presentations as well as remarks/comments and explanations in this context contain forward-looking statements on
the business development of the Volkswagen Group. These statements are based on assumptions relating to the development of the
economic, political and legal environment in individual countries, economic regions and markets, and in particular for the automotive
industry, which we have made on the basis of the information available to us and which we consider to be realistic at the time of
going to press. The estimates given entail a degree of risk, and actual developments may differ from those forecast.
At the time of preparing these presentations, it is not yet possible to conclusively assess the specific effects of the latest
developments in the Russia-Ukraine conflict on the Volkswagen Group’s business, nor is it possible to predict with sufficient
certainty to what extent further escalation of the Russia-Ukraine conflict will impact on the global economy and growth in the
industry in fiscal year 2022.
Any changes in significant parameters relating to our key sales markets, or any significant shifts in exchange rates or commodities
relevant to the Volkswagen Group or the supply with parts, or deviations in the actual effects of the Covid-19 pandemic from the
scenario presented will have a corresponding effect on the development of our business. In addition, there may be departures from
our expected business development if the assessments of the factors influencing sustainable value enhancement and of risks and
opportunities presented develop in a way other than we are currently expecting, or if additional risks and opportunities or other
factors emerge that affect the development of our business.
We do not update forward-looking statements retrospectively. Such statements are valid on the date of publication and can be
superseded.
This information does not constitute an offer to exchange or sell or an offer to exchange or buy any securities.
Under the brand “Volkswagen Financial Services – the key to mobility“ the subsidiaries of Volkswagen Financial Services AG as well
as its sister company Volkswagen Bank GmbH render various services under the joint brand "Volkswagen Financial Services". Such
services are banking services (through Volkswagen Bank GmbH), leasing services (through Volkswagen Leasing GmbH), insurance
services (through Volkswagen Versicherung AG, Volkswagen Autoversicherung AG) as well as mobility services (inter alia through
Volkswagen Leasing GmbH). In addition, insurance products of other providers are offered.
20Volkswagen Financial Services – organisational structure
FINANCIAL SERVICES
DIVISION
Volkswagen Financial Services
21We offer the whole range of services under one roof*
BANKING LEASING INSURANCE & SERVICE MOBILITY PAYMENT
BANK LEASING INSURANCE SERVICES FLEET USED CARS CHARGE & SUBSCRIPTION PARKING PAYMENT
FUEL & RENTAL
• Retail Financing • Motor incl. • Service & • Multi-brand • Used Car • Fuel & Service • Payment for • Payment for • In-Car-Payment
• Finance Lease
• Wholesale Telematics Inspection capability Marketplace Cards parking space parking space • Mobile Payment
• Operating Lease
Financing • Warranty • Full and Limited • Reporting HEYCAR • Charge & Fuel • Services around • Services around • Wallet
• Factoring Maintenance • Telematics • Leasing Card parking parking
• GAP & CPI • Local public
• Deposits • Tyres • Life-Cycle- marketplace • Toll • On- and off- • On- and off- transport
• Commercial
• Comprehensive Services street street
Lines
cover • Consulting • Car subscription
service
CONTACT FREQUENCY
PROFITABILITY
* Displayed portfolio depends on the market; products offered or mediated by different operative subsidiaries.
22Volkswagen Financial Services – in a nutshell
Record high
operating result
€ 5.67bn
Inflation has no
material effect Lower risk costs
up to now than expected
Digitalization Chip shortage
leads to high
systematically demand for used
pursued cars
23At a glance as of 31.12.2021
Volkswagen Bank GmbH Volkswagen Financial Services AG
Total assets € 67.3 billion Total assets € 124.6 billion
Equity € 10.9 billion Equity € 14.4 billion
Customer deposits € 26.5 billion Operating profit € 2,987 million
Operating profit € 1,137 million Contracts (units) 15.8 million
Contracts (units) 3.3 million Employees 11,021
Employees 1,906
*Receivables + Leased Assets *Receivables + Leased Assets
24Operating income
Volkswagen Bank GmbH Volkswagen Financial Services AG
€m €m
3.000
2,987
3.000
2.500 2.500
2.000 2.000
1.500 1.500
1,137 1,223 1,210
952
1.000 757 840 1.000 844
500
500
0
0
2018 2019 2020 2021
2018 2019 2020 2021
25Credit risk management at Volkswagen
Financial Services
• The Covid-19 pandemic has not significantly
influenced the credit risk development of the VW
FS.
• In history and until today our credit losses
(dynamic loss ratio = drawings on provisions
including direct write-offs relative to the average
volume of receivables) have been on a very low
level (0.27% as of 31.03.2022). Provision- vs. Loss Ratio
• The credit risks are appropriately covered by
provisions.
Forecast:
The risk situation will remain challenging because
of the ongoing Corona pandemic, the crisis
situation in the Ukraine as well as expected
increasing interest rates.
2626Residual value risk management at
Volkswagen Financial Services
Re-marketing situation used car center
• The current positive trend in the development of
Residual Value
used car prices is related to an increased
demand in the used car market, driven by the projection
projection
current shortage of new car deliveries due to the
chip shortage and the current crisis situation in
the Ukraine.
We assume this trend to be a short term effect
only.
• As soon as the situation will relax we do expect
the demand on used cars to step-by-step return
to prior crisis level.
This is why we did not adapt our Residual Values
for new business.
• Even in 2022 the still high used car prices will
have a positive effect on our operating profit but
this will be lower than in 2021.
2727Worldwide capital market activities
Volkswagen Financial Services Group
VW FS Polska VW Bank Russia*
Volkswagen Leasing Mexico* € 7.5 bn CP Program
Domestic PLN Bond Domestic RUB Bond
MXN 20 bn Dual CP + MTN Program € 50 bn Debt Issuance Program
Issue Program Issuances
Volkswagen Bank
VW Bank Mexico*
€ 2.5 bn CP Program
MXN 7 bn Debt Issuance Program
€ 10 bn Debt Issuance Program
VW FS Korea
Domestic KRW Bond
Issuances
VW FS Japan*
JPY 60 bn ECP Program
VDF Turkey
Domestic TRY Bond VW Finance
Issuances (China)
Domestic RMB Bond
Issuances
Banco VW Brazil
Domestic
Letra Financeira
VW FS India
Domestic
INR CP + Bond Issuances VW FS Australia*
* Guarantee Volkswagen Financial Services AG AUD 5 bn Debt Issuance Program
28Worldwide ABS activities
VW Finans Sverige
Autofinance S.A. VW Leasing
VCL program
VW Leasing/DutchLease VCL Master
VCL Master
MAN Financial Services
Trucknology
VW Finance China
VW Bank
VW FS UK Driver China program
Driver program
Driver UK program
Driver Master
Driver UK Master
VW Bank Spain VW FS Japan
Driver España program Driver Japan program
VDF
Driver Turkey Master
Banco VW Brazil VW Bank Italy
Driver Brasil program Driver Italia program
VW FS Australia
Volkswagen Bank GmbH Programs
Driver Australia program
Volkswagen Financial Services Driver Australia Master
Programs
29Funding allocation of segment Volkswagen Financial Services as of 31.12.2021
Volkswagen Financial Services Strategic Funding Mix
€ 181.8 bn
30Changing customer preferences reduce the dependency on dealerships and lead to direct
sales and cross-country competition and solutions
Changing customer behavior … … is being actively addressed by many market players
Strong trend towards fully digital transactions in Digital vehicle purchase and
consumer business financing
Direct Customer contact and sales in European fleet International conditions and
business multi-brand
Calls for digital easy-to-use used car reselling options European platforms
31In the existing business model, VW FS has mainly indirect contact to customers,
therefore we are adding a “Digital & Direct” channel
DEALERS VWFS
DATA
BRANDS CUSTOMERS CUSTOMER CAR
» Enabler Model « » Digital & Direct «
32ETOM lays the organizational foundation for
customer centricity along three Sales channels
Customer We rely on the strong
foundation of our
Dealer Digital & Direct Direct Fleet
Serve Dealer Serve customers Serve European strengths …
customers directly corporates seamlessly
… and consequently
Strong customer focus across all sales channels
explore new business
Expansion of business in growing market areas areas at the same time
(digital and fleet business)
Consequent digitalization of product portfolio
and customer journeys
33We aim to be #1 in Dealer, #1 in Digital & Direct and #1 in Fleet
#1 #1 #1
in Dealer in Digital & Direct in Fleet
34Vision and targets of Route2025
VISION
WE ARE THE BEST AUTOMOTIVE FINANCIAL SERVICES GROUP IN
THE WORLD
OPERATIONAL
CUSTOMERS EMPLOYEES EXCELLENCE PROFITABILITY VOLUME
STRATEGIC
DIMENSIONS
WHAT
STRATEGIC • Excited • Top Employer • Compliance& • Total Operating • 30M Contracts
TARGETS Customers • Top Employees Governance Income
• Process Efficiency
• 50% Extended
• 20% ROE
• IT Excellence Penetration
• 40% CIR
35Route 2025 – almost there!
50% Penetration
CUSTOMERS VOLUME 30 mn Contracts
4 bn Operating
EMPLOYEES PROFITABILITY Income
40 % CIR
20% RoE
OPERATIONAL
EXCELLENCE
36Questions?
37Thank you! Volkswagen Financial Services AG Investor Relations Gifhorner Str. 57 38112 Braunschweig katja.hauer@vwfs.com +49(0)531.212 84608
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