Similar to Tesla at the end of April, the Volkswagen Group published its business figures for the first quarter of 2021 this week. As with Tesla, the profit was significantly higher than expected – and yet, after the Q1 figures, the VW share now also recorded losses. Because the German company increased its forecast for the year, but warned of ongoing chip problems in the current quarter, and some analysts its China business was not strong enough. In addition, its CEO Herbert Diess assumes that it will not be able to meet the electric car and emissions regulations there on its own until 2023.
Few VW electric cars in China
Despite the record surplus of 3.4 billion euros in the first quarter, an analyst from Bernstein Research saw, according to Fortune magazine, “a fly in the ointment”: In the important Chinese market, VW’s profit was different from that of its German competitor BMW and Daimler not well developed. At the same time, the electric car offensive launched by Volkswagen in Europe is apparently not progressing quickly enough in the country.
As Volkswagen announced for the entire group, its electric car deliveries increased dramatically by 78 percent from Q1 2020 to Q1 2021. This means that they have “almost doubled”, the presentation says, interestingly with the note “very low tactical sales”. For 2020, the environmental organization Greenpeace accused VW of having largely achieved the strong increase in its electric car sales at the end of the year with such internal approvals.
However, VW’s growth in electric cars is still clearly focused on Europe, where every manufacturer has had strict requirements for fleet emissions since last year. 71 percent of the 59,900 Volkswagen electric cars sold in the first quarter remained in the EU plus three other countries on the continent. 13 percent went to North America, and only 10 percent to China, which is already the world’s largest market for battery vehicles.
High revenue potential for Tesla
There, too, Volkswagen (in two joint ventures) has been on the electric car course since this year with the world car VW ID.4 and initially exclusively with the ID.6. But according to CEO Herbert Diess, that will not be enough by 2023 to meet the requirements in China for emissions and the proportion of electric cars. For 2019 and 2020 it had already been announced that Volkswagen and its local partners would buy credits for this from other manufacturers. According to unconfirmed reports, the seller is Tesla.
So after the former credit buyer Fiat-Chrysler (FCA) has just said goodbye to its deal with Tesla for the West, a new one seems to be waiting in China with Volkswagen. According to calculations by teslamag.de, VW could pay the equivalent of $ 390 million to Tesla for the past few years alone, more than is now lost with the FCA merger to Stellantis. According to the Fortune report, Diess also announced that the Chinese rules will not be fully complied with on their own before 2023. Tesla also seems to have a need to buy in the coming years.