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By Christoph Steitz and Christina Amann
FRANKFURT/BERLIN (Reuters) – Volkswagen forecast a slowdown in sales expansion in 2024 on Friday, adding to rivals’ caution in the face of a weaker economic outlook, higher festivals and higher costs.
Europe’s biggest carmaker, whose brands include Audi, VW and Lamborghini, expects sales to rise as much as 5% in 2024, after 15. 5% last year to 322. 3 billion euros ($349 billion).
This expansion suggests a turnover of up to €338 billion in 2024, higher than the €316 billion estimated by LSEG analysts.
Volkswagen’s chief financial officer, Arno Antlitz, forecasts a “subdued economic outlook and intense competition” for 2024, but the automaker remains self-confident throughout the year, announcing new product launches.
The comments echo those of competitors adding Mercedes-Benz and Stellantis, both of which set a tone for their effects last month.
European automakers are under pressure from both U. S. rival Tesla and Chinese rivals, at a time when global momentum for electric cars is losing steam in the face of waning sales expansion and waning government support.
Volkswagen’s shares turned negative and fell as much as 7. 1% to their lowest point in more than 4 weeks after its annual results, which included a drop in operating margin to 7. 0% in 2023 from 7. 9% a year earlier.
They were down 4. 6% at 16:06 GMT, while shares in Porsche, majority-owned through Volkswagen, also reversed gains and held steady.
Volkswagen said it expects an operating margin of 7. 0% to 7. 5% in 2024 and proposed increasing the dividend on its shares and those it likes from €0. 30 to €9. 00 and €9. 06 each, respectively.
The automaker said its investment rate is expected to peak in 2024 of between 13. 5% and 14. 5%, driven by spending in its key market, China, and would decline in the following years to around 11% through 2027.
($1 = €0. 9249)
(Reporting by Christoph Steitz and Christina Amann; editing by Rachel More, Elaine Hardcastle and Alexander Smith)