VW AG Financial Services Eyes Earnings Drop
Market normalization as supply crunches ease will reduce the division’s profits.

A normalized used-car market will cause profits of VW's financial arm to fall.
Andrea Piacquadio
Volkswagen AG's financial-services division predicts a substantial drop-off in annual profit as the semiconductor chip and other component shortages ease and normalize the used-car market.
VW’s financial arm expects 2023 earnings to be significantly lower than last year's.
The division reports operating profit slipped to $6 billion. Shortages of chips and other disruptions to supply chains and logistics constrained auto manufacturers' pandemic recovery efforts, it reported, which drove up prices for new and used vehicles.
Elevated residual values helped in-house lending units that carmakers and their dealers use for consumers to finance car purchases and leases. But their earnings are forecasted to fall off this year.
"2022 was once again an exceptional financial year strongly affected by special factors," said Volkswagen Financial Services CFO Frank Fiedler in a press release. "It can be anticipated that a repeat of such a result will not be possible in the short term."
Originally posted on Auto Dealer Today
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