SUVs are complicating life for car manufacturers, as they are bigger, heavier and less aerodynamic, consume and emit more pollutants, which forces brands to tighten their belts to be able to respect the limits imposed by Brussels.
On the other hand, as they are more expensive, they make the builders increase the profit per unit sold, which triggers the gains at the end of the year. This is exactly what happened with Volkswagen AG, which announced a 22% growth in operating profits compared to 2018, reaching 16.9 billion euros.
The results now revealed lead the German group to propose the payment of dividends to shareholders of € 6.50 per share, an improvement on the € 4.80 paid in 2018. The increase in profits in 2019 was achieved at the expense of transversal growth , to which all markets contributed, without any being particularly prominent.
After announcing the 2019 results, VW did some futurology for 2020, presenting the forecasts for the current year. According to German officials, turnover should increase by 4%, despite the fact that sales volume remains unchanged, that is, around 10.98 million vehicles sold in 2019.
Regarding the profit margin on invoicing, VW anticipates for 2020 a value between 6.5% and 7.5%, lower than the 7.6% it achieved in 2019. However, given the current problem caused by the coronavirus, the Germans predict that the fall in the market, and in profits, may be higher than anticipated estimates, all of which were calculated before this outbreak originated in China.