Press Release

Braunschweig, 25 March 2021. Volkswagen Financial Services have closed the financial year 2020 very successfully despite the coronavirus pandemic. The operating result, which fell to EUR 2.8 billion (-5.3 percent), is the second highest in the company's history. "We are very pleased to be able to present such a good result given the extremely challenging conditions," said Lars Henner Santelmann, Chairman of the Management Board of Volkswagen Financial Services AG. "In the thick of the crisis, it is clear how robust our business model is and how important it was that we consistently implemented our cost reduction program and also invested in the digitalization of our business model at an early stage." Frank Fiedler, CFO of Volkswagen Financial Services AG, added: "It is in particular the global increase in our market penetration and a significantly better fourth-quarter performance that have led to an operating result well above our original expectations. In addition, lower risk costs than were assumed after the first six months of last year have also had a positive effect on the result."

While the number of new contracts acquired worldwide declined by 6.9 percent to a total of 7.9 million units (previous year: 8.5 million units), the portfolio of current contracts rose slightly compared with the previous year to 21.9 million units (+1.9 percent). The total assets of the Volkswagen Financial Services business division amounted to EUR 225.6 billion (+1 percent, previous year: EUR 223.5 billion). The total number of current contracts at the end of the year was 21.498 million units (+5.9%, previous year: 20.3 million units). The total assets of the business division Volkswagen Financial Services amounted to EUR 223.5 billion (+7.7%, previous year: EUR 207.6 billion).

Digitalization, used cars, fleet business

Volkswagen Financial Services continue to anticipate a global contract portfolio of 30 million contracts by 2025. The main growth drivers for this are seen in the digitalization of the company's business model, the global expansion of the used car business and a greater focus on the European business with fleet customers. "In 2025 we expect an operating result of around EUR 4 billion with total assets of approximately EUR 300 billion," Fiedler forecasts. He adds: "Thanks to our organizational realignment in 2017, we can also achieve this target without additional equity capital."

Volkswagen Financial Services are currently undergoing a complete transformation process. The company had already invested EUR 500 million in digitalization well before Covid-19. Santelmann explains: "We are expanding our existing business model to include a data-driven direct sales approach." The development of further mobility services, such as vehicle subscription or parking, fueling and charging services, will also increase the number of customer touchpoints from the current level of around 210 million per year to 400-600 million. Santelmann: "In the future, we want to remain involved with the vehicle and the customer for much longer and thus participate along the automotive value chain better than we do today."

Subject to overall economic developments and the uncertainty in the course of the ongoing Covid-19 pandemic, Volkswagen Financial Services expect their results in 2021 to be in line with the previous year.

Information for editors:

Volkswagen Financial Services are a business division of the Volkswagen AG group of companies and comprise Volkswagen Financial Services AG along with its associated companies, Volkswagen Bank GmbH, Porsche Financial Services, and the financial services companies in the USA and Canada that belong directly or indirectly to Volkswagen AG – with the exception of the financial services of the Scania brand and Porsche Holding Salzburg. The key business fields embrace dealer and customer financing, leasing, the bank and insurance business, fleet management and mobility offers. Volkswagen Financial Services have a total of 16,558 employees worldwide – including 7,472 alone in Germany. Volkswagen Financial Services report total assets of around EUR 225.6 billion, an operating result of EUR 2.8 billion and a portfolio of around 21.9 million current contracts (as at: 31.12.2020).