Volkswagen AG, Europe’s largest carmaker, said it plans to increase sales to more than 10 million vehicles by 2018 as it seeks to dethrone Japan’s Toyota Motor Corp., reported Bloomberg.com.
VW’s management board approved business targets, including profit margins, measured by earnings before interest and taxes, of at least 5 percent for the automotive business in the “medium term,” Wolfsburg, Germany-based Volkswagen said in a statement today. The target doesn’t include Porsche SE, which will be integrated by 2011, it said.
Volkswagen CEO Martin Winterkorn has a target of beating Toyota, the world’s biggest carmaker, in global deliveries and profit margins. VW sold 6.29 million cars and sport-utility vehicles worldwide last year, an increase of 1.1 percent from 2008. Toyota said last month that 2009 vehicle sales including those of affiliates fell 13 percent to 7.81 million vehicles. The Japanese carmaker is dealing with a global vehicle recall because of accelerator pedals that may stick.
By 2018, Volkswagen, which includes the Audi luxury division and Czech unit Skoda, should have a pretax profit that exceeds 8 percent of sales, the company said.
Volkswagen fell 18 cents, or 0.3 percent, to 65.72 euros after rising as much as 1 percent on the Frankfurt exchange before the announcement. The automaker has a market value of 25.7 billion euros ($36 billion).
“With the implementation of ‘Strategy 2018,’ the Volkswagen group is seeking global economic and environmental leadership in the automotive industry by 2018,” VW said in its statement. The plan would include “significant cost cutting, in part through the more prominent use of the modular design principle.”
VW foresees steps to promote research and development of hybrid and electric cars, according to the statement. VW will also maintain “strict discipline” on spending and aim to keep the expenditure on fixed assets in auto-making at about 6 percent of sales in the medium and long term.
