Letter to our Shareholders
for Volkswagen Group, 2024 was the year of major strategic decisions in a rapidly changing environment. Volkswagen Group has not let this slow it down. On the contrary. In 2024, we set a decisive course – and drove the change forward in the long term. With innovative, desirable products and clear decisions.
In a year with a wide range of challenges, Volkswagen Group has once again proven that we have a strong substance. At the same time, we are working consistently to optimize our cost structures, increase our profitability and further strengthen our financial robustness.
With around 9 million vehicles delivered, we almost matched the previous year’s level. We recorded significant growth in North America (+6%) and South America (+15%). This contrasts with declines in a very competitive market in China (−10%). In our home market of Europe, we have developed steadily and are at the forefront – in combustion engines and electric cars. The large number of model changes gives us a good starting point for the coming years.
The turnover amounts to €325 billion. The operating result is around €19 billion. Net cash flow in the Automotive division reached €5 billion and net liquidity around €36 billion.
These are robust results in a challenging global environment. The fact that we achieved them in a phase of restructuring with the associated considerable costs shows our resilience.
This financial stability gives us the necessary leeway to continue investing in the future and pursuing our strategic goals. We will propose a dividend of €6.36 per preferred share to the Annual General Meeting in May. This corresponds to a distribution of 30% of our net profit.
Our top 10 programs remain the key management instrument for our operational and strategic activities. With measurable milestones, ambitious goals, clear responsibilities and a systematic roadmap.
The power of Volkswagen Group lies in the power of our brands. We inspire customers worldwide with a fascinating product range in all segments. We impressively demonstrated this in 2024: More than 30 new models were launched. The most extensive and powerful product offensive in our company’s history.
We have set an example in e-mobility: In our home market of Europe, we are the market leader in all-electric vehicles. The Audi Q6 e-tron and the Porsche Macan have made a successful start on the new Premium Platform Electric (PPE). The most advanced electrical architecture of our Group with modern software. In this way, we are establishing a new generation of high-performance, all-electric models.
The ambitious performance programs help us to make the company even more financially robust. We have to work in a disciplined manner here and pay attention to the framework conditions on the market, react and adapt. This requires perseverance and the consistent work of everyone to secure the target returns through concrete and measurable measures.
Zukunft Volkswagen agreement is the foundation for the economically successful tomorrow at Volkswagen AG and its German locations: a milestone in reconciling competitiveness and job security in the long term. In total, we are sustainably reducing our personnel costs by €1.5 billion per year. In the medium term, we expect cost reductions of more than four billion euros per year through the implementation of all agreements. Our technical capacities at the German plants will be adjusted by around 730,000 units. We are streamlining our workforce by more than 35,000 by 2030. The strategic goal for the profitability of the Volkswagen brand is therefore realistic in the medium term – a significant increase in earnings with a major impact on the Group.
In 2024, we reached milestones for our global software strategy. We have realigned our software activities and strengthened the team with new partners. Together with XPeng for China and our new US partner Rivian for the other regions of the world, we are developing the software solutions of the automotive future with forward-looking zonal architectures. Our own software company CARIAD will focus on central cross-sectional technologies in the future. In addition, we bring the control of the existing software to where it is used: to the brands that are developing it further with CARIAD. This creates clear responsibilities and focus in the use of all resources.
The Chinese market has unprecedented dynamism. In the electrification, digitization and automation of mobility. Volkswagen Group is now consistently following this “China Speed”. In 2024, we decisively advanced our “In China, for China” approach.
North America remains a key starting point for Volkswagen Group’s growth strategy and a well-balanced regional business in markets worldwide. With our investments in the localization of production and in strategic partnerships, we are sending a clear signal of further growth. A six percent increase in deliveries in North America in 2024 proves us right.
The battery is at the heart of tomorrow’s mobility. With the unit cell, we have created a global, cross-brand technology platform. It reduces complexity and ensures economies of scale. On the one hand, we rely on external suppliers. On the other hand, we are also taking this key technology into our own hands with our subsidiary PowerCo.
In all of this, sustainability is the basis of our actions. We stand by our responsibility. And we act with measurable success.
We have achieved a lot in the past year. This is the merit of an extraordinary team. Around 680,000 people at more than 100 locations around the world, who have driven our company forward day after day with passion and enthusiasm. I would like to thank you for this today on behalf of the entire Executive Board team.
Our vision is clearly defined:
"The Global Automotive Tech Driver".
We also have big plans for 2025. For our Group, for our brands, for each and every one of us. Our company does not only want to accompany the globally accelerated technological change. We want to shape it. Our vision is clearly defined: “The Global Automotive Tech Driver”.
What gives us the strength for this claim? Our unique combination of global presence and local expertise. Our focus on our own qualities in cooperation with strong partners – the best in their field. Our mobility – and our will to change. And: Our strategy of efficiently and powerfully leveraging economies of scale – in the essential fields of transformation: with our software architectures, battery technologies, mechatronics platforms and product concepts.
We will remain on the offensive in 2025: around 30 new models will be launched worldwide. We focus on our strength: our products. Fascinating vehicles with which we position ourselves at the forefront of the competition. Our customers can look forward to the new T-Roc from Volkswagen, the new Audi Q3, the Lamborghini Temerario, highly emotionalizing 911 derivatives from Porsche and much more. We recently celebrated the world premiere of the ID. EVERY1 show car. Our smallest has great potential as a game changer in the ramp-up of e-mobility.
The future of mobility is electric. It is superior to combustion engine technology in terms of its property profile. We stand by that. At the same time, we see that the transformation of global markets is developing at different speeds. In addition to the products, it depends on the charging infrastructure, energy prices, incentive models and regulation.
What Volkswagen Group was recently criticized for is now our competitive advantage: our broad, flexible product portfolio across all drive variants. Whether pure electric vehicles, efficient combustion engines or modern hybrid concepts. We combine plug-in hybrids with our combustion engines. The planned use of range extender technology also shows that we can meet demand in line with the market and in a tailor-made manner.
This year, too, we have set ourselves an ambitious TOP 10 program. In 2025, it will be about thorough cost work, attractive products, and strengthening our presence in the regions.
Europe is our home. We are the market leader in this area and we want to further consolidate this position. Our order intake for all-electric cars in Western Europe almost doubled last year.
Volkswagen Group expects 2025 to be another challenging year in the Chinese market. We are prepared. In 2025, we will introduce the first models of the Audi brand from the cooperation with SAIC, as well as two further Audi models based on PPE. The Volkswagen brand’s model offensive will start in 2026. By 2030, Volkswagen Group plans to deliver 30 new electric models tailored to local requirements to customers.
We see great market opportunities in North America. Accordingly, we have an investment and growth focus here. With a product portfolio that is even closer to the expectations of American customers. In doing so, we use local synergies of our strong local brands.
We think globally and act locally: that is the strength of Volkswagen Group.
Our vehicle architectures offer tailor-made property profiles in every segment of our global markets: flexibly positioned with combustion engines, hybrids and electric vehicles.
We are catching up with the vehicle software, convincing in the range and getting good feedback. Our new global software strategy aims to provide a superior digital offering for our customers. We think of the car in development from the point of view of the software. Our Software Defined Vehicles – SDV for short – will set standards. In our joint venture with partner Rivian, we are designing this advanced and powerful SDV architecture and will integrate it into Volkswagen Group’s product portfolio from 2027. In the eastern world, we have a strong partner in XPeng, with whom CARIAD China and Volkswagen China Technology Company are developing a competitive zonal architecture. And want to bring it to market as early as the end of 2025.
We focus on implementing a holistic battery strategy – in a balanced, scalable and intelligent relationship between in-house and partner solutions. At the same time, we are working on convincing offers for the entire life cycle of our cars.
We see sustainability as the basis of our actions. With a sharpened strategy, a concrete implementation plan and the new, operational Sustainability Advisory Board, we are taking on corporate responsibility. The decisive factor in all of this is that a strong, international team makes the difference.
Dear Ladies and Gentlemen, with a great deal of dedication and passion, Volkswagen Group has brought itself into shape over the past two years. In 2025, we must and we will unleash the power – and make the reward for these efforts tangible. If we consistently continue on this path, there are great opportunities ahead of us to take off from 2026. We will seize these opportunities. Because we have a responsibility. For our company, our employees, our society and our environment. This group has great potential. We will deliver. The playing field is ready. Our team is set up. Our tactics are strong. We enjoy the game. And now, we are scoring goals.
Sincerely,
Oliver Blume