Volkswagen's Strategic Reset is Moving Forward

Dow Jones10-13

1256 GMT - Volkswagen's cost-cutting agenda is gaining momentum, platform simplification is progressing and China is increasingly evolving into both an innovation and export hub, Deutsche Bank analyst Tim Rokossa writes. The automaker's management used the Paris Motor Show to reiterate the significant challenges facing the business but outlined a clearer pathway toward its 8%-10% margin ambition by 2030. "More importantly, the discussion appears to be shifting from what needs to be fixed to how it will be fixed." The bank says that investors have heard margin targets before, but this time management provided considerably more detail on capacity, head count, complexity reduction and capital allocation than in previous presentations. It rates Volkswagen at buy with a 105 euro target price. Shares rise 1.2% to 69.35 euros.

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