Valuation Model (Google Sheets)

See also: Older research in Wiki

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Investment Thesis

Volkswagen is a cheaply valued company at an valuation of around 4-5 on a P/E basis. Their brands produce quality cars which are liked for a range of reasons like their reliability (VW Core Brand) or their Brand appeal (Porsche). They have very strong financial assets in their balance sheet resulting from car backed loans from Volkswagen financial services.

We believe their management is doing a good job in transforming the group into a leaner, performance culture driven, pragmatic and modern company.

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Key Strengths

• Strong balance sheet of Volkswagen Financial Services (add more details)
• Diversified car model base: Volkswagen brand targeted at low-priced segment and Audi and Porsche targeted at premium segments.
• Competitive car models in Europe and North America. </aside>

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Key Weaknesses

• Catching up on digitalization
• Large capex cost to modernize factories esp. given the shift to EVs
• EU CO2 regulatory pressure
• USA tariff pressure </aside>

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Main Opportunities

• Very cheap valuation.
• Performance programs to increase efficiency of group.
• Upcoming (2026-2027) BEV models targeted at European and Chinese market. </aside>

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Main Threats

• Threats from Chinese EVs.
• Risk of autonomous driving. </aside>

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Key considerations (What do we look for as most crucial signs of success)

• Ability of management to turn the group around, produce great cars and modernize. </aside>

Definitions of titles in each column

Volkswagen High Level

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• Definitions </aside>

Volkswagen Details