Volkswagen’s January deliveries rose 13.3% as demand in China boosted demand in Europe, the world’s largest market. The German automaker, which sells vehicles under its VW, Audi, and Porsche brands in China, saw sales in the country climb 43% compared with the same month last year, the highest growth in any significant individual market.
The results helped Volkswagen offset a sharp decline in its “Asia-Pacific Rest” region, including all markets outside China. Sales in the region fell by 12.5%, including a steep drop in China, the company’s biggest single market.
A slowdown in sales in China followed the outbreak of a severe respiratory virus. The disease caused many people to stay home and cut shopping, causing overall vehicle sales in the world’s largest single market to decline. Volkswagen’s sales were also hit by a lack of new electric motors, forcing it to stop ID.3 production in 2023 temporarily. The company said production was re-started in December, and the EV market is recovering.
In Western Europe, demand developed encouragingly in most countries despite the pandemic. The Volkswagen Taos and ID.4 from Passenger Cars, the Audi A3 saloon and Q5 Sportback from Audi, and the Cayenne from Porsche were among the models that attracted strong customer demand in January.
In North America, sales were slightly up in a market that showed a noticeable contraction. The Tiguan Allspace and Jetta from Volkswagen Passenger Cars, the Audi Q4 e-tron and Porsche Macan from Audi, and the Saveiro, Taigun, and Nivus from Volkswagen Commercial Vehicles were the most sought Group models in this market.
Europe’s biggest automaker has made a series of deals with local companies to bolster its China turnaround strategy that focuses on adapting its products to the country’s market. The firm has partnered with Horizon Robotics Technology R&D Co for autonomous driving, ThunderSoft for in-car software, and Gotion High-Tech Co for batteries.
Volkswagen’s shares, which trade in Frankfurt, gained as much as 2.9% in early trading on Friday. The stock has fallen 33% this year as investors have become more cautious about the impact of a trade war between the United States and the European Union on global auto sales.
The company’s stock lost almost a fifth of its value in 2018 but has since recovered to near-record levels, helped by a strong performance in its core carmaking business and by the fact that it is one of the few carmakers to have built a viable electric car division. The firm aims to lead in this segment by 2025, ahead of rivals such as Tesla Inc and BYD Co Ltd. The shares have more than doubled in the past two years but still lag far behind rivals in terms of overall value. In the latest period, the firm’s revenue from carmaking was flat. However, earnings from its truck and bus businesses rose. The company is scheduled to report full financial results on March 13.
