Volkswagen Has no Easy Way Out

Dow Jones09-03

0754 GMT - Volkswagen has no easy way out, either it cuts costs or loses market share, Citi analysts write. The bank says it is not the company that has made German plants unviable, rather it is decades of negligent German industrial/energy policy, negligent EU/China trade policies and EU carbon-dioxide policies, combined with assertive China auto industry subsidies and exports. If anything, Volkswagen's global business has been subsidizing uncompetitive German plants for too long, it adds. From a capital-structure view, Citi says Volkswagen could perhaps spin off its German core business and allow the Audi, Porsche, Traton and Finco businesses to stand alone. The bank adds that the current predicament highlights the importance of EU industry protection. Shares fall 1.1%.

At the request of the copyright holder, you need to log in to view this content

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

We need your insight to fill this gap
Leave a comment