Volkswagen Cuts Car Deliveries Chip woes are expected to be resolved in the near future.
Volkswagen reported high first-half profits on Thursday, but lowered its car delivery target for this year due to a worsening semiconductor chip scarcity.
Despite this, the 12-brand group – which includes Porsche, Audi, Seat, and Skoda — raised its profit forecast for 2021 after a “record” first-half performance from high-end automobiles.
VW said it was now aiming for a 6.0 to 7.5 percent operating return on sales, a carefully scrutinized metric of performance. 5.5-7.0 percent had been the previous target.
Before special items, adjusted operating profits reached 11.4 billion euros ($13.5 billion), up from 10 billion euros in pre-crisis 2019 — the year before coronavirus lockdowns wreaked havoc on the auto industry.
Herbert Diess, the CEO of Volkswagen, praised the “historic result.”
He stated in a statement that the premium segment performed particularly well, with double-digit returns.
However, while the company claimed it had managed to keep the impact of the worldwide semiconductor shortfall to a minimum so far, the consequences will be “more obvious” in the third quarter.
VW, like other automakers, has recently been forced to cut production at several factories due to a shortage of critical computer chips, which has been fueled by a pandemic-driven rise in demand for household devices.
The consequences are already being felt in major markets like as China, where VW just reported reductions.
“Throughout the industry, the potential of bottlenecks and interruption in the supply of semiconductor components has increased,” VW stated, decreasing its full-year delivery prediction.
It now forecasts “noticeably higher” deliveries to clients in 2020, if the economic recovery from the pandemic is on pace.
VW had previously predicted a “significant” increase in deliveries.
Diess also stated that the company’s e-offensive was “gaining traction,” with 171,000 all-electric vehicles shipped globally, a 165 percent increase year over year.
The company, which is investing tens of billions of euros in the industry’s transformation to greener vehicles, has set its eyes on being the world’s largest seller of electric vehicles.
By 2030, VW anticipates battery-powered vehicles to account for half of its sales, and “nearly 100 percent” by 2040.