INVESTMENT AND FINANCIAL PLANNING 2011 TO 2015 IN THE AUTOMOTIVE DIVISION
Based on our planning, investments in the Automotive Division will amount to €53.5 billion in the period 2011 to 2015. Besides investments in property, plant and equipment, this total also includes additions to capitalized development costs of €10.3 billion, investments in financial assets of €1.9 billion net and proceeds from the disposal of property, plant and equipment. Investments in property, plant and equipment will account for €41.3 billion, more than half of which (57%) will be invested in Germany alone. The ratio of capital expenditure to sales revenue in the period 2011 to 2015 will be at a competitive level of around 6% on average.
The Volkswagen Group will systematically continue its model rollout with a view to tapping new markets and segments, spending most of the total amount invested in property, plant and equipment in the Automotive Division, at €27.7 billion or around 67%, on modernizing and extending the product range of all brands. The main focus will be on new vehicles, successor models and model derivatives in almost all vehicle classes based on modular platform technology. In powertrain production, new generations of engines will be launched with further improvements in performance, fuel consumption and emission levels. The Group will press ahead in particular with the development of hybrid and electric motors.
In addition, the Company will make cross-product investments of €13.6 billion over the next five years. Due to our high quality targets and the steady improvement of our assembly processes, the new products also require changes to the press shops, paintshops and assembly facilities. Production in the new factory in North America will also begin in 2011. Beyond production, investments are planned mainly in the areas of development, quality assurance, genuine parts supply and information technology.
Our aim is to finance the investments within the Automotive Division using internally generated funds. For the planning period, we are forecasting cash flows from operating activities of €66.0 billion. The funds generated will therefore exceed the Automotive Division’s investment requirements by €12.5 billion.
The planning is based on the Volkswagen Group’s current structures and thus includes the investments in Suzuki (19.9%) and Porsche Zwischenholding GmbH (49.9%) accounted for using the equity method, but does not take into account the further steps toward an integrated automotive group. The acquisition of Porsche Holding Salzburg and the associated outflow of €3.3 billion are also not featured into this planning.
The joint ventures in China are also not consolidated and therefore not included in the above figures. These companies will invest a total of €10.6 billion in the period 2011 to 2015. These investments will be financed using the joint ventures’ own funds.