Auto focus

The pandemic impact on Q1

Murali Gopalan | Updated on May 07, 2020 Published on May 07, 2020

The Volkswagen Group recorded a ‘substantial impact’ on its business as a result of the pandemic in the first three months of the current year (January-March).

Deliveries to customers fell 23 per cent from the previous year to two million vehicles. Frank Witter, member of the Group Board of Management responsible for Finance and IT, said the “gradual restart”, also of factories outside of China, had begun.

In Germany, dealers have reopened and the group has taken steps together to get the business up and running again while steering through this “unprecedented crisis with focus and determination”. VW expects deliveries to customers in 2020 to be significantly below the previous year due to the pandemic. Challenges will also arise particularly from the increasing intensity of competition, volatile commodity/foreign exchange markets and more stringent emissions-related requirements. Sales revenue of the group in 2020 is expected to be significantly below the prior year’s level as a result of Covid-19.

Overall, the VW Group expects operating profit for 2020 to be ‘severely below’ the prior year, but still to remain positive. Despite countermeasures, the R&D ratio and the ratio of capex to sales revenue in the automotive division are expected to be above the previous year’s level in 2020 due to lower demand and therefore falling sales revenues.

Published on May 07, 2020

A letter from the Editor

Dear Readers,

The coronavirus crisis has changed the world completely in the last few months. All of us have been locked into our homes, economic activity has come to a near standstill. Everyone has been impacted.

Including your favourite business and financial newspaper. Our printing and distribution chains have been severely disrupted across the country, leaving readers without access to newspapers. Newspaper delivery agents have also been unable to service their customers because of multiple restrictions.

In these difficult times, we, at BusinessLine have been working continuously every day so that you are informed about all the developments – whether on the pandemic, on policy responses, or the impact on the world of business and finance. Our team has been working round the clock to keep track of developments so that you – the reader – gets accurate information and actionable insights so that you can protect your jobs, businesses, finances and investments.

We are trying our best to ensure the newspaper reaches your hands every day. We have also ensured that even if your paper is not delivered, you can access BusinessLine in the e-paper format – just as it appears in print. Our website and apps too, are updated every minute, so that you can access the information you want anywhere, anytime.

But all this comes at a heavy cost. As you are aware, the lockdowns have wiped out almost all our entire revenue stream. Sustaining our quality journalism has become extremely challenging. That we have managed so far is thanks to your support. I thank all our subscribers – print and digital – for your support.

I appeal to all or readers to help us navigate these challenging times and help sustain one of the truly independent and credible voices in the world of Indian journalism. Doing so is easy. You can help us enormously simply by subscribing to our digital or e-paper editions. We offer several affordable subscription plans for our website, which includes Portfolio, our investment advisory section that offers rich investment advice from our highly qualified, in-house Research Bureau, the only such team in the Indian newspaper industry.

A little help from you can make a huge difference to the cause of quality journalism!

Support Quality Journalism
This article is closed for comments.
Please Email the Editor
You have read 1 out of 3 free articles for this week. For full access, please subscribe and get unlimited access to all sections.