VW to Defend Global Sales Crown Amid $21 Billion Diesel Hit

(Bloomberg) -- Volkswagen AG’s global deliveries rose to a fresh record last year as robust customer demand helped the German manufacturer weather the financial fallout from its diesel-emissions crisis and -- most likely -- stay ahead of Japanese rival Toyota Motor Corp.

Worldwide sales of the group’s cars, trucks and buses jumped 4.3 percent to 10.7 million vehicles in 2017, VW said Wednesday in an emailed statement.

“We are grateful to our customers for their trust,” Chief Executive Officer Matthias Mueller said in the statement. “We will continue to do everything we can in 2018 to meet and exceed the expectations of our customers all over the world,” he said. Toyota has forecast about 10.4 million vehicles sales for 2017 and is scheduled to release the final number later this month.

A strong presence in China and a slew of new sport-utility vehicles like the VW Tiguan and the Skoda Kodiaq helped cushion an unprecedented cash outflow of about 17 billion euros ($21 billion) last year that was triggered by the September 2015 revelation of diesel-engine emissions-control rigging. The undiminished popularity of its vehicles is vital to generating the funds Volkswagen needs to emerge from the crisis while it also makes hefty investments in new technologies such as electric and self-driving cars.

The Wolfsburg-based company, whose stable of 12 automotive brands includes Porsche sports cars, Scania heavy-duty trucks and Ducati motorbikes, will seek to sustain sales momentum this year with models including an updated version of the VW Touareg SUV, the new Virtus in South America and a large SUV added to the lineup of its Spanish Seat nameplate. The Audi division, VW’s largest earnings contributor, will roll out its first all-electric model, dubbed E-tron, and the new Q8 flagship SUV.

“We are making decisive investments in the mobility of tomorrow, using funds from our own resources: in electric mobility, autonomous driving, new mobility services and digitalization,” Mueller said. “At the same time, we continue to systematically develop present technologies and vehicles. The excellent delivery figures confirm that this is the right approach.”

Sales in China, VW’s largest single market, rose 5 percent to 4.18 million vehicles last year, while Western Europe eked out 1.4 percent growth to 3.58 million cars, trucks, vans and motorbikes, despite lower demand in Germany and a softening U.K. market. VW reported double-digit percentage gains in Russia and Brazil as demand in those countries started to recover from a steep downturn.

VW preference shares were little changed at 183.66 euros as of 9:05 a.m. in Frankfurt. The stock advanced 25 percent last year.

To contact the reporter on this story: Christoph Rauwald in Frankfurt at crauwald@bloomberg.net.

To contact the editors responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net, Tom Lavell

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