{"id":109654,"date":"2021-03-16T13:01:48","date_gmt":"2021-03-16T13:01:48","guid":{"rendered":"https:\/\/fin2me.com\/?p=109654"},"modified":"2021-03-16T13:01:48","modified_gmt":"2021-03-16T13:01:48","slug":"volkswagen-looks-to-electric-vehicles-cost-cuts-for-profit-recovery","status":"publish","type":"post","link":"https:\/\/fin2me.com\/markets\/volkswagen-looks-to-electric-vehicles-cost-cuts-for-profit-recovery\/","title":{"rendered":"Volkswagen looks to electric vehicles, cost cuts for profit recovery"},"content":{"rendered":"
FRANKFURT (Reuters) – Volkswagen is confident that cost cuts will help it raise profit margins in the coming years, the world\u2019s second-largest carmaker said on Tuesday, a day after outlining an ambitious electric mobility expansion.<\/p> \u201cOur good performance in 2020, a year dominated by crisis, will give us momentum for accelerating our transformation,\u201d Chief Executive Herbert Diess said in a statement.<\/p>\n Asked about the closely-watched issue of a potential listing of luxury division Porsche AG, Diess said there was no need for immediate action given Porsche\u2019s importance to the carmaker\u2019s turnaround efforts.<\/p>\n \u201cThat\u2019s why you need to think very very hard about every single step,\u201d he said.<\/p>\n Preferred shares in the company rose as much as 6.5% to their highest level since July 13, 2015, giving the carmaker a market valuation of more than 118 billion euros ($141 billion). They are up more than a third year-to-date.<\/p>\n Volkswagen aims to more than double deliveries of electric vehicles to 1 million this year, it said, adding it would also apply a standardised platform model introduced for vehicle production years ago to software, batteries and charging.<\/p>\n Diess\u2019 comments come a day after Volkswagen unveiled plans to build half a dozen battery cell plants in Europe and expand infrastructure for charging electric vehicles globally, accelerating efforts to overtake Tesla.<\/p>\n Related Coverage<\/p>\n<\/p>\n Volkswagen confirmed it aimed for an operating margin of 7%-8% by 2025, adding it would likely end 2021 at the upper end of a 5%-6.5% target corridor.<\/p>\n Stellantis, the world\u2019s fourth-largest carmaker created through the merger of FCA and Peugeot maker PSA in January, is targeting an adjusted operating profit margin of 5.5%-7.5% this year.<\/p>\n This will be achieved by lowering fixed costs by 2 billion euros by 2023 compared with 2020, a decline of 5%, as well as a decline of 7% in materials costs over the same period, Volkswagen said.<\/p>\n To get a better handle on personnel costs Volkswagen on Sunday offered early or partial retirement to older employees in a move sources said could cut up to 4,000 jobs at its plants in Germany.<\/p>\n The group employs about 670,000 staff globally.<\/p>\n \u201cWe aim to put the ambitious transformation of the Volkswagen Group on a solid financial basis,\u201d incoming finance chief Arno Antlitz said.<\/p>\n ($1 = 0.8375 euros)<\/p>\n