volkswagen group china · 2020. 9. 24. · 2004: founding of volkswagen group china for...
TRANSCRIPT
Volkswagen Group ChinaDr. Jörg Mull, Executive Vice President, Finance
J.P. Morgan Investor Meeting, BeijingJune 05th, 2014
Business Overview and Sales Performance
Market Development
Investments Volkswagen Group China
Driven by Design and Technology
Financial results, challenges and opportunities
2
Content
Introduction of Volkswagen Group China (VGC)
Volkswagen production facilities in China History
1985: Founding of Shanghai Volkswagen Automotive Co. (SVW) as joint venture with Shanghai Automotive Industrial Corporation (SAIC). 10 million vehicles produced as of November 2013.
1991: Founding of FAW-Volkswagen Automotive Co. Ltd. (FAW-VW) as second joint venture with First Automotive Work (FAW). 8 million vehicles produced as of end 2013.
2004: Founding of Volkswagen Group China for coordination and management of activities of Volkswagen Group within China.
Total Investments 1985-2013Planned Investments 2014-2018Employees 2014
€ 18.5 Billion€ 18.2 Billion
89,000
Volkswagen Transmission
Shanghai VolkswagenPowertrain
FAW-Volkswagen(Volkswagen, Audi)
Volkswagen FAW Engine
Volkswagen FAW Platform
Shanghai Volkswagen
Shanghai Volkswagen(Volkswagen, ŠKODA)
Volkswagen AutomaticTransmission Dalian
Volkswagen China Investment Company
Beijing
Shanghai
Dalian
Chengdu Nanjing
FAW-Volkswagen
Car production plants
Component plants
Headquarter Volkswagen Group China
3
Yizheng
Volkswagen FAW Platform
Urumqi
Shanghai Volkswagen
Foshan
FAW-Volkswagen
TianjinVolkswagen AutomaticTransmission Tianjin
Shanghai Volkswagen
Ningbo
Changchun
Volkswagen FAW Engine
Volkswagen FAW Platform
ChangzhouMAN Diesel & Turbo
Successful partnership with FAW and SAIC
4
FAW 60%, VW AG 30%, AUDI AG 10%Share
1,524,000 unitsDeliveries 2013
1991Foundation
Volkswagen
Sagitar Magotan
Audi
Audi A6L
Audi A3 SB
Audi Q5Audi Q3
Golf
Jetta
CC
Audi A4L
New Bora
SAIC Motor 50%, VW AG 50%
Volksw
agen
Santana Passat
Škoda
Fabia
Rapid
OctaviaSuperb
Touran
Tiguan
LavidaPolo
Share
1,531,000 unitsDeliveries 2013
1985Foundation
Yeti
Gran Lavida
Rapid SB
Deliveries of Volkswagen in China in January - April 2014
51) incl. Hongkong, excl. MAN, Scania, and Ducati. All figures shown are rounded, so minor discrepancies may arise from addition of these amounts.
Ʃ 1,117Ʃ 1,117
VW Group: 73
Locally Produced(‘000 Units)
Import FBU(‘000 Units)
FAW-VW
SVW
Total Deliveries Region China 1,1901)
544
573
Deliveries to customers by brand in January - April 2014
700
100
1,100
0
400
1,000
900
800
1,200
600
500
300
200 +12.4%
+17.0%
1312
+7.9%
78170142
921
84
1,190
1,017
+19.9%
+17.5%
784
2014 Jan-Apr
2013 Jan-Apr
6
All brands contributed with a solid sales performance in Jan-Apr 2014 to the strong growth of Volkswagen Group China y-o-y
1) incl. Hongkong, excl. MAN, Scania and Ducati.
(‘000 Units)
Rank Brand/GroupChanges of
market share(YTD)*
1 Volkswagen Group + 0.9%
2 Competitor 1 - 0.1%
3 Competitor 2 - 1.0%
4 Competitor 3 + 1.0%
5 Competitor 4 + 0.3%
21%
10%
10%
6%5%
29%
Volkswagen Group leading the Passenger Vehicle Market
7
Comp.3Comp.4
Comp.2
Comp.1
Volkswagen GroupOthers(i.e. localbrands)
* Compared to last Year YTD
China Passenger Vehicle Market (Jan-Apr 2014 YTD)
Business Overview and Sales Performance
Market Development
Investments Volkswagen Group China
Driven by Design and Technology
Financial results, challenges and opportunities
8
Content
9* Deutsche Bank March/April 2014
** Minimum GDP growth requirement of the Chinese Government
Due to the stabilization of the economic growth in Europe and the US, Chinese exports are expected to increase. Furthermore, the new growth model focuses more on domestic consumption, hence private consumption is likely to increasein 2014. Both should contribute to a stable economic development in China.
7.77.7
9.2
10.3
0
1
2
3
4
5
6
7
8
9
10
11
GDP (YoY%)
2015E
8.0*
2014E
7.8*
7.5**
2013201220112010
Chinese economy on a path of stable growth
7.78.4 8.77.7
02468
10
Consumption (YoY%)
2014E
7.0*8.1*
20132012
GovernmentPrivate
6.5
2.8
8.5
3.7
02468
1012
Import/Export (YoY%)
10.0*
2014E
11.0*
20132012
ImportExport
Current 5-year-plan: New growth model with focus on domestic market
11th 5-year-plan 2006-2010 12th 5-year-plan 2011-2015
Multi-National-Companies and infrastructure projects as growth generatorBig growth in manufacturing tradeJobs in cities to keep unemployment lowInternationally comparable price stability and well-adjusted foreign trade balance
Domestic consumption as growth acceleratorMegacities as growth generator Focus on environmental protection and energy efficiencyEncouragement of Chinese innovationsSocial stability due to balanced allocation of prosperity Selective policies for foreign investment as well as globalization of Chinese companies
Past:Focus on export and quantitative growth
Now:Focus on domestic market and qualitative growth
10
Sales of passenger vehicles accelerated again in 2013
11
Total Passenger Car Market – China (incl. HK)(‘000 Units)
Data Source: Volkswagen Group China / IHS Global Insight
11.457
2.266
13.537
2011
12.388
2003 20102009
8.482
2008
+9%
+18%
5.503
+8%
+54%
CAGR +19%
+35%
20132012
15.947
Restrictive policies for new car sales in developed Eastern Megacities
12
pAccording to CAAM*, there are 6 more cities which will implement restriction policies; Chengdu and Shijiazhuang could issue restrictive policies in 2014.* China Association of Automobile Manufacturers
Quota (2014)
Zhejiang
Heilongjiang
Jilin
Hebei Tianjin
Shandong
Hainan
Shanghai
Yunnan
Sichuan
Shaanxi Gansu Qinghai
Xinjiang
Tibet
Henan
Anhui
Jiangsu
Jiangxi Fujian
Hunan
Hubei
Inner Mongolia
Shanxi
Guangxi
Ningxia
Chongqing
Guizhou
Beijing:150k cars/year
Tianjin:~ 100k cars/yearBeijing
Shanghai:~ 100k cars/year
(not fixed)
Hangzhou:80k cars/year
Guangzhou:120k cars/year
Guangdong
Liaoning
GDP Growth development is expected to differentiate more strongly between the various Chinese regions
13Data Source: Provincial Government Report / Regional Government Media
Zhejiang
Heilongjiang
Jilin
Liaoning
Hebei Tianjin
Shandong
Guangdong
Hainan
Beijing
Shanghai
Yunnan
Sichuan
Shaanxi Gansu Qinghai
Xinjiang
GDP Growth 2013 YoY12-15%
10-12%
7-10%
Tibet
Henan
Anhui
Jiangsu
Jiangxi Fujian
Hunan
Hubei
Inner Mongolia
Shanxi
Guangxi
Ningxia
Chongqing
Guizhou
Province2013 YoY GDP Gr. %
2013 YoY GDP (Billion RMB)
Tianjin 12.5 1,437Guizhou 12.5 801Chongqing 12.3 1,266Yunnan 12.1 1,172Tibet 12.1 81Fujian 11 2,176Shaanxi 11 1,605Xinjiang 11 836Gansu 10.8 627Qinghai 10.8 210Anhui 10.4 1,904Guangxi 10.2 1,438Jiangxi 10.1 1,434Hubei 10.1 2,467Hunan 10.1 2,450Sichuan 10 2,626Hainan 9.9 315Ningxia 9.8 257Jiangsu 9.6 5,916Shandong 9.6 5,468Innermogolia 9 1,683Henan 9 3,216Shanxi 8.9 1,260Liaoning 8.7 2,708Guangdong 8.5 6,216Jilin 8.3 1,298Hebei 8.2 2,830Zhejiang 8.2 3,757Heilongjiang 8 1,438Beijing 7.7 1,950Shanghai 7.7 2,160
12th 5-year-plan 2011-2015
14
Low vehicle density in Level III and IV cities in China
ᴓ cars/1,000inhabitants
Number of cities
Level I citiesLevel I cities Level II citiesLevel II cities Level III citiesLevel III cities Level IV citiesLevel IV cities
BeijingShanghai
Guangzhou…
DalianXi´an
Changsha…
ShantouHengshui
Jingdezhen…
GuyuanYaan
Zhangyue…
9 26 68 109
11995
62
29
16.7 8.4 4.9 4.0ᴓAverage # of
inhabitants (m)
Content
Business Overview and Sales Performance
Market Development
Investments Volkswagen Group China
Driven by Design and Technology
Financial results, challenges and opportunities
15
Go West and Go South Strategy for further growth
Existing vehicle production site
Planned vehicle production site
Urumqi
Chengdu
Changchun
NanjingYizheng
Shanghai
Ningbo
Foshan
Beijing
“Go South Strategy”
“Go West Strategy”
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Changsha
Changchun Changchun Changchun
Chengdu Chengdu ChengduFoshanFoshan
FoshanShanghai
Shanghai
Shanghai
Nanjing
Nanjing
Nanjing
Yizheng
Yizheng
Yizheng
Ningbo
Ningbo
Ningbo
Urumqi
Urumqi
Urumqi
Changsha
Changsha
3.135 Mio
2013Production
2013Capacity
2015Capacity
2018Capacity
Upward flexibility
Capacity expansion plans – on the way to 4 million units in 2018Standard capacity of 250 working days
17
4 Million units
Capacity expansion plans are based on certain assumptions for the development of unit sales growth, upward flexibility (e.g. additional working days) and downward flexibility (e.g. postponement of expansion steps) are given.
FAW-VW
SVW
Urumqi
Chengdu
Changchun
Yizheng
Shanghai
Foshan
Beijing
Ningbo
Existing MQB production sitePlanned MQB production site
Nanjing
Changsha
Existing production site
Implementation of MQB*) toolkit in Chinese production network
18
Octavia
*) MQB: Modularer Querbaukasten / modular transversal toolkit
A3Golf
Start: 2013Global MQB volume Global MLB volume
201420132012 20162015
MQB volume China
MQB & MLB volume development of Volkswagen Group
MQB & MLB volume development of Volkswagen Group
19
Distribution of MQB savingsDistribution of MQB savings Different powertrains
Additional serial +option contentSavings to be partly absorbed to fulfill regulatory and legal requirements
Lower cost per unitLess EHpV1)
Less one-off expenditures
MQB platform ca. 60% of total material costs
= Potential savings
Margin improvement
Savings Expenditures Invest
1) Engineered Hours per Vehicle
The MQB's flexible design is able to accommodate alternative drives:
MQB – Driving forward economies of scale in unit cost, investment and supporting achievement of emission targets
TDI Diesel, FlexFuel and BiFuel currently not part of the product offering of Volkswagen Group China. First BEV will be introduced at the end of 2014.
TDI Diesel, FlexFuel and BiFuel currently not part of the product offering of Volkswagen Group China. First BEV will be introduced at the end of 2014.
Further strengthening of partnerships with SAIC and FAW
20
Signing ceremony May 26th, 2013 in BerlinConfirmed engagement in Changsha
Signing ceremony May 26th, 2013 in BerlinCapacity expansion in Foshan
SAIC FAW
Significant extension of product portfolio planned: 2018 with more than 100 models
Note: number of product models
CKD >35 FBU>65 >100
21
Commercial Vehicles
2018E:
2013: CKD 22 FBU 41 63
1,593
341320
2013 2014E 2018E
Significant growth of dealer networks planned*
>3,600
2,395
* Map includes only Volkswagen, Audi and Škoda dealers; discrepancies may occur due to reporting backlog 22
as of end of Q1
Xinjiang
Tibet
Qinghai
Gansu Inner Mongolia
Shaanxi
NingxiaShanxi
Hebei
Guangdong
Fujian
Shanghai
Shandong
Liaoning
Jilin
Heilongjiang
Beijing
Zhejiang
Tianjin
GuizhouHunan
Jiangxi
Guangxi
ChongqingHubei
Yunnan
Sichuan Anhui
Hainan
Henan Jiangsu88
129
53
58 101
39
100
4213
65
20364
14231
31
220
40
99
202
10
63
61
25
69
6
29
88
28
64
9
42
~2,750
Content
Our Momentum in China
Market Development
Investments Volkswagen Group China
Driven by Design and Technology
Financial results, challenges and opportunities
23
Volkswagen China – Product solutions to match our customer’s needs
Passat ChinaPassat USA
A6 Europe
A6L China
24
China special detail solutionsChina special detail solutions
China specific wheelbase extensions, trim and colorsChina specific wheelbase extensions, trim and colorsYeti Europe
Yeti ChinaChina exclusive spare wheel
Volkswagen China – Product solutions to match our customer’s needs
25
New Lavida New Jetta New SantanaNew Lavida New Jetta New Santana
Gran Lavida New BoraGran Lavida New Bora
Volkswagen Group China aims to actively engage in the NEV market with locally produced and localized PHEVs
26
20202013 20162013
Phase
Introduction
Timing
Import Local production
Localization of NEV technology
Development
Audi A3 e-tron
VW electric up!Porsche Panamera S E-Hybrid
Porsche 918 Spyder
Audi A6 e-tron
2016
Golf GTE
27
E-Scrub Process – Part of improvements with new technology E-Scrub Process – Part of improvements with new technology
Sustainable Production - Environmental Friendly Standard Factories
Heatrecovery
Renewableenergy
New Paint shops
Insulation
Cold watersystem
Energy-savinglightingsystems
Example FAW-VW FoshanExample FAW-VW Foshan
-22% -18%
CO2Energy
Water VOC*
-65%-23%
conventional processconventional process
process 2010Vprocess 2010V
Light Domes – improving lighting and saving electrical energy
Insulation of buildings for saving heating and cooling energy
First Chinese automotive plant with triple star Green Building Award
New Paint Shops - Savings through e.g. E-Scrub ProcessNew Paint Shops - Savings through e.g. E-Scrub Process
Consumption per Car
Advanced water treatment process –savings of 27% of fresh water demand through completed re-use of treated water
* Volatile organic compounds
Content
Business Overview and Sales Performance
Market Development
Investments Volkswagen Group China
Driven by Design and Technology
Financial results, challenges and opportunities
28
Volkswagen Group China reported another strong operating result for Q1 2014
29
1) SVW Group/FAW-VW Group
Deliveries to Customers
Production (100%)1)
(’000 Units)
(’000 Units)
(€ m)
1,923
1,914
1,907
2010 2011
2,259
2,202
2,616
2012
2,815
2,643
3,678
2013
3,271
3,135
4,296
2014 Q1
881
842
1,241
4,3894,389 6,1346,134 8,4248,424(€ m) 9,569 2,835Operating profit (100%)
Operating profit (quotal)
Additional business opportunities: Increasing importance of retail finance
30
New Retail Finance Contracts
* Based on the total passenger car sales in the market China.
227,000
149,000
78,000
20122011
52%
91%
2014E2013
stronger finance demand expected
cash buyer dominance
20%
80%
2013
Finance Cash
min.30%
max. 70%
2018E
Finance Cash
25.6%74.4%
Finance Cash Buyers
9.9%
15.7%
VWFS China Retail Finance Penetrationin VGC Network
(% of deliveries to customers)
Financial Services expects increase in retail finance share*
YTD 2014
Additional business opportunities: Growing Pre-Owned Car business
31
Qualitative and quantitative roll-out of Group POC dealers
million units
Total Pre-Owned Car Market Forecast1)
1) Source: China Automotive Dealer Association in Feb 2014
3.5
2012 2016E
10.6
7.2
8.7
5.1
6.3
2014E
6.5
4.8
2013 2015E 2020E
18.2
10.9
2019E
16.0
10.3
2018E
14.0
9.5
2017E
12.4
8.44.8
3.1
2011
4.3
2.7
Pre-Owned Passenger CarPre-Owned Commercial Vehicle
111
285
182
420
330304
VW + SK(Das WeltAuto)
Audi(Refined
Recomm.)
Porsche(Approved Pre-
Owned)
Bentley(Bentley Pre-
Owned)
2013 2014E 2013 2014E 2013 2014E 2013 2014E
Group Pre-Owned Car Dealer Roll-out
0
0,5
1
1,5
2
2,5
3
3,5
4
Volkswagen Group China
32
Volkswagen Group China is well positioned to maintain its number one position in the market and seize additional opportunities in the future
Delivered vehicles in million units
Disclaimer
This presentation contains forward-looking statements and information on the business development of the Volkswagen Group. These statements may be spoken or written and can be recognized by terms such as “expects”, “anticipates”, “intends”, “plans”, “believes”, “seeks”, “estimates”, “will” or words with similar meaning. These statements are based on assumptions relating to the development of the economies of individual countries, and in particular of 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 involve a degree of risk, and the actual developments may differ from those forecast.
Consequently, any unexpected fall in demand or economic stagnation in our key sales markets, such as in Western Europe (and especially Germany) or in the USA, Brazil or China, will have a corresponding impact on the development of our business. The same applies in the event of a significant shift in current exchange rates relative to the US dollar, sterling, yen, Brazilian real, Chinese renminbi and Czech koruna.
If any of these or other risks occur, or if the assumptions underlying any of these statements prove incorrect, the actual results may significantly differ from those expressed or implied by such statements.
We do not update forward-looking statements retrospectively. Such statements are valid on the date of publication and can be superceded.
This information does not constitute an offer to exchange or sell or an offer to exchange or buy any securities.
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