Volkswagen Group Mobility is optimistic about its financial future, anticipating improved results in 2025 following a slight downturn in 2024. The company’s financial division reported an operating profit of 3.0 billion euros for the previous year, a decrease of 7.7% compared to the year before. Despite this drop, the group’s confidence remains intact as they prepare for the upcoming fiscal year.
One of the bright spots amid these financial fluctuations is the record high deposits at Volkswagen Bank. This increase signals a solid foundation for the bank, yet the institution has had to raise its risk provisions as a response to potential future uncertainties.
In a significant move, on March 19, 2025, Volkswagen utilized the favorable market conditions surrounding its commercial vehicle holding, Traton, to initiate a long-anticipated share sale. The sale, which encompassed approximately 2.2% of Traton’s shares, netted the company 360 million euros. Following this transaction, Volkswagen's stake in Traton will decrease from 89.7% to 87.5%. Volkswagen has reiterated its commitment to maintaining support for Traton, ensuring it remains a vital entity under its umbrella.
VW’s Chief Financial Officer, Arno Antlitz, highlighted the strategic importance of this move on LinkedIn, stating, "Traton will continue to be supported by Volkswagen as a committed and responsible shareholder." This assurance reflects the company’s aim to remain a significant player in the commercial vehicle sector while allowing a broader market participation through increased public float of shares.
The decision builds on a history of cautious but strategic leadership since Traton was publicly listed in 2019. Although Volkswagen retained around 90% of shares initially, Antlitz noted that the increased free float has fostered better trading liquidity for the stock. This latest share sale also sends a positive signal to shareholders about the long-term viability of Traton.
While Volkswagen navigates these financial waters, the company is also facing challenges on the labor front. Recent rulings by the German Federal Labour Court favor VW employees, specifically regarding short-time work measures introduced during the COVID-19 pandemic. The court ruled that hours accrued in long-term accounts should not have been deducted during this period of reduced workloads.
The judges affirmed that the protection of employee rights remains paramount, emphasizing that the law was meant to shield workers enduring the pandemic's financial fallout. As a result, VW must now reassess how it handles such accounts in future short-time work scenarios.
The ruling serves as a reminder of the delicate balance that companies like Volkswagen must maintain between profitability and the welfare of their employees. As the company strides forward, it is clear that Volkswagen is determined to uphold its responsibilities to its workforce while also working to achieve lucrative outcomes for its investors.
Looking ahead, Volkswagen intends to remain the majority and controlling shareholder in Traton, aiming for a stake of at least 75% plus one share. This strategy indicates a clear vision for the company’s future in the commercial vehicle market while also portraying an intent to nurture shareholder interests. VW’s long-term stewardship of Traton not only reflects its commitment to growth but also indicates an awareness of the greater market dynamics at play.
In summary, Volkswagen Group is cautiously optimistic as it steps into 2025, armed with strategic financial maneuvers and a commitment to balancing shareholder demands with employee rights. The ongoing developments in both its financials and labor relations signify a turning point for the automotive giant, positioning it for future success amid the evolving landscape of the automotive industry.
