Porsche - World's Most Profitable Carmaker in 2006

Porsche - World's Most Profitable Carmaker in 2006
by RAIN STOCKTON

Bloomberg reports Porsche AG's 911, a $72,400 sports car, spurred the carmaker’s being the world's most profitable last year. CEO Wendelin Wiedeking says earnings will grow even more because of Volkswagen AG's Golf, a $15,000 hatchback.

The report said Wiedeking may extend the luxury car company's share-price gains by increasing the stake and using Porsche's influence to convert Europe's biggest carmaker. Analysts and investors say Porsche's experience in “thin” production will enhance Volkswagen's profitability, while the companies will save by sharing development costs.

Sales and profit at Volkswagen, now 31 percent owned by Porsche, have already increased since the initial tie-up, spurring Porsche's shares more than double.

Peter Braendle, who helps manage almost 63 billion Swiss francs ($52 billion) in assets at Swisscanto Asset Management in Zurich, plus shares in both car companies, said Porsche knows how to manage itself and stands to significantly earn from its ownership in Volkswagen.

Adam Jonas, an analyst at Morgan Stanley in London, forecasts that Porsche's profit may grow to more than 3 billion euros, which is tantamount to $4.1 billion, in five years from 1.39 billion euros in the 12 months ended July 2006. He expects that the company's shares will reach 1,650 euros within a year, as compared with Thursday's closing price of 1,330 euros.

Juergen Meyer, who helps manage almost 1.3 billion euros of assets at SEB Asset Management in Frankfurt, including Volkswagen and Porsche shares, commented that the alliance between Porsche and VW is extremely important to Porsche.

As regards lagging profitability, the report says that such concern on Volkswagen would crimp Porsche's growth sent the luxury carmaker's shares plunging 10 percent on Sept. 26, 2005, a day after Porsche said that it would acquire a stake in the larger automaker.

In 2005, Wolfsburg, Germany-based Volkswagen's operating margin was 3 percent as compared with 19 percent at Porsche in the 12 months ended July that year.

Volkswagen's margin widened to 4.3 percent in 2006, as new models such as the Eos and the Audi Q7 helped lift sales 10 percent to 5.72 million vehicles. Net income increased more than doubled.

Cost cutting already began at Volkswagen. As a matter of fact, former Chief Executive Bernd Pischetsrieder has thrown off 20,000 jobs.

Andreas Dittmer, who helps manage nearly 3.5 billion euros in assets at Apo Asset Management in Cologne, Germany, which includes Volkswagen shares, commented that “Volkswagen has become leaner'.

Porsche is entitled to almost one third of Volkswagen's dividend, which was 497 million euros in 2006. Wiedeking said on June 26 that Porsche's profit will really rise significantly this year. And thanks to Volkswagen.

The German carmaker is the genius behind Volkswagen Golf parts.

VW Records 1.8 Million Vehicles in First Half of 2007

VW Records 1.8 Million Vehicles in First Half of 2007
by RAIN STOCKTON


German automaker Volkswagen delivered 1.8 million vehicles from January to June of this year to customers around the world. Such figure is a 7.4 percent more than in the same period last year. The Middle East market experienced a sales increase of a paused 32 percent compared to last year.

The Touareg confirms that is has its special position as the most popular Volkswagen car in the Middle East region with 33 percent of Volkswagen’s total sales for the first half of 2007 and a 14 percent increase of sales in the first half of 2007 as compared to the same period in 2006 in the region.

Hans-Dieter Keller, Managing Director of Volkswagen Middle East stated that they are witnessing a significant growth in the region because of their attractive and increasingly unique model range. He explained that the Touareg is their bestseller in the region and the launch of the new generation Touareg recently has lifted their sales quite significantly for the first six months of 2007. He also said that the launch of Volkswagen’s new coupe-convertible, the Eos, and the introduction to the Jetta 2.5 liter earlier this year has also played roles to this growth. He boasted that aside from their excellent model range, the professional market coverage by their partners has been vital to their success.

All in all, the Volkswagen Group delivered 3.09 million vehicles to customers worldwide in the first six months of 2007. This figure is an all-time sales record for the company for the first half of the year. This conforms to a 7.8 percent increase over the same period last year. From January through June 2007, group deliveries in Europe increased by 3.7 percent to 1.86 million vehicles, 1.62 million of which went to Western Europe, which reflects a 1.3 percent increase. The 238,000 vehicles sold in Central and Eastern Europe marked a hike of 22.8 percent.

The Volkswagen Group sold as much as 502,000 vehicles in the Asian-Pacific region; it is actually 20.9 percent more than in the first half of last year. In China alone, the deliveries increased by 24.6 percent to 431,000 vehicles.

Sales significantly developed in the first half of the year on the American continents as well. The Group’s deliveries to customers in South America hiked by 27.7 percent resulting to 339,000 delivered cars. Two hundred sixty thousand (260,000) of which went to Brazil, generating a 28.6 percent growth. In North America, the sale of 263,000 vehicles produced an increase of 3.1 percent, thereby registering U.S sales with 2.8 percent growth having 163,000 vehicles.

Volkswagen is the maker of quality Volkswagen bug parts.

Volkswagen to Enter Sensor-Driven Passat in 2007 DARPA Urban Challenge

Volkswagen to Enter Sensor-Driven Passat in 2007 DARPA Urban Challenge
by RAIN STOCKTON


The 2007 Defense Advance Research Projects Agency (DARPA) Urban Challenge, one of the most unique car races in the world, will take place on November 3. Several teams will allow their "smart" vehicles to enter on a course covering 60 miles of unknown territory and designed to vitalize urban driving conditions.

Each team’s aim is to post the fastest time while, of course, observing traffic regulations. The race requires participating vehicles to mingle into traffic, cross roundabouts and negotiate busy intersections. All cars are steered and driven by computers.

In the race, Volkswagen will enter its customized Passat backed with performance quality VW exhaust and built by Volkswagen's research department and its California-based Electronic Research Laboratory (ERL) with the assistance of Stanford University.

Named in commemoration to Stanford University founder Leland Stanford Jnr., the Passat "Junior" is equipped with electromechanical power steering, an electric accelerator pedal, a Direct Shift Gearbox (DSG) and an electric handbrake. And to make the vehicle 100 percent computer-controlled, Volkswagen of America's Electronic Research Laboratory (ERL) modified these electric systems and the brakes. Further equipment designed and built by the ERL includes the Custom-made mountings for the array of sophisticated sensors. Intel Core 2 Duo processors with two multiple-processing units per chip are some of the compositions of the vehicle's "brain". All these with the software developed at Stanford University's Artificial Intelligence Laboratory, the vehicle will be genuinely independent.

Dr. Burkhard Huhnke, head of Volkswagen's Electronic Research Laboratory, said that Volkswagen is excited to join the 2007 DARPA Urban Challenge after its victory at the last DARPA Grand Challenge. He said that they see an opportunity to further advance intelligent technologies for the future use in the next generation passenger vehicles. He explained that the features developed for the Urban Challenge will ultimately result to driving safety and more fun in today's increasingly congested traffic. He continued that they have the perfect car for the said challenge, just like their Touareg 'Stanley' in its 2005 Grand Challenge triumph.

With ‘Stanley’ as the name, VW’s Touareg TDI won the DARPA Grand Challenge in 2005. Stanley bested among 22 other unmanned vehicles with its onboard sensors and navigation features. The 2005 race was a demanding 132-mile championship taking in rough desert roads, mountain passes, dried-up lakes and tunnels. And without a single glitch, Stanley completed the race with a winning time of six hours and 54 minutes.

The Electronic Research Laboratory
Founded in 1998, Volkswagen of America's Electronic Research Laboratory (ERL) is focusing its work on providing customers with smarter vehicles for the future. Based in Palo Alto, California, its work involves identifying new technologies and accelerating their development for future vehicle production.

DARPA
DARPA or Defense Advance Research Projects Agency is an organization of the United States Department of Defense.