Chip Shortages Lead to 11-Year Low in Volkswagen Sales

Volkswagen AG is expecting sales to increase this year as supply bottlenecks ease and existing orders are fulfilled. However, the company is facing semiconductor shortages in 2022 that could lead to a decrease in deliveries.
Volkswagen reported Thursday that group sales fell 7% to 8.3 million vehicles, citing supply constraints that caused factories to grind to a halt. The company pointed to a high order bank of 1.8 million vehicles in Western Europe that it said would help offset a sputtering global economy.
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"We are confident that we will see improvements in the macroeconomic situation and in the supply of parts and components in the coming year," said VW's group sales head Hildegard Wortmann in a statement. "This will give us the momentum we need to continue our success in 2023."
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The decline in marks has reached a 11-year low, with 2023 set to improve. This means that fewer students are getting the marks they need to succeed.
After months of delays due to shortages of chips, shipping containers, and raw materials, carmakers are now facing a weakening outlook, particularly in Europe. High energy prices are fanning record inflation there, making it difficult for consumers to afford new vehicles. However, full order books should help bolster profits well into the middle of the year. And with China removing most of its Covid restrictions, customers should start returning to showrooms soon.

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VW shares rose 0.5% in Frankfurt trading on Wednesday, taking the company's gains since the start of the year to 10%.
In the fourth quarter, a 28% surge in deliveries in Western Europe and a 9.4% rise in sales in China helped to offset some of the earlier declines in both regions. However, Volkswagen's sales in China, its biggest market, still slid 3.6% amid concerns that Western carmakers are losing ground to local competitors, particularly in the electric vehicle market.

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Electric-car sales rose 26% to 572,100 vehicles in 2020, accounting for 6.9% of the total. This just missed VW's own target of between 7% and 8%. The best-selling models included the VW ID.4 and the Audi e-tron.