By What Percentage Have Volkswagen’s Revenues And EBITDA Grown Over The Last Five Years?
Volkswagen AG‘s (OTCMKTS:VLKAY) namesake brand of passenger vehicles constitutes ~60% of the volume sales for the company, but has been struggling in the last five years, due to stiff competition, and macroeconomic headwinds in South America and Eastern Europe. Volkswagen brand has also struggled to gain market share in the U.S., where it had planned to sell 800,000 vehicles annually by 2018. The brand sold less than 350,000 units in the country in 2015, down 4.8% year-over-year, and continues to record declining sales so far in 2016. Volume sales are down 12% year-over-year in the U.S. through April. In addition, the brand is pulling down the group’s operating margin as it is operating at only a 2% margin, due to lower revenues and large investments in R&D. Volkswagen’s R&D expenditure was a very high 48% of gross profit in 2015, compared to 15% for Toyota and 22% for General Motors. Volkswagen spent more than any company in any sector globally on R&D in 2014. The company is now looking to cut costs at its namesake brand going forward, which could help lift overall margin.
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