VW admits CRISIS: “We have 1 or 2 Years” to save the company says CFO

guys if if you do a Google search for the electric Viking you you'll find one of the top negative results for me is a forum post about my comments about the Volkswagen group clearly people who own Volkswagen group Vehicles whether that's Audi or Volkswagen scoda they're Furious and they're really really angry and they're saying that I'm making stuff up about the Volkswagen group well yeah I mean unfortunately for them everything I said turned out to be absolutely correct I know this makes it sound like I'm blowing my own horn I'm not I was simply pointing out the obvious that these people are unable to accept because they love their brand so much emotion is clouding their judgment Elon Musk in fact a few days ago said this he said where is the Volkswagen group going to get $5 billion to invest in rivan and a lot of people didn't take this seriously a lot of people thought El musk was just being a hater he was being a negative um person basically you know slandering the opposition however if that were the case why the hell did the CFO of the Volkswagen group just come out and say that Volkswagen has only one or maybe maximum two years to save the brand that's a literal quote one maybe two years to save the brand guys if I was speaking with hyperbole which some people say was the case why is the Volks group's Chief Financial Officer basically agreeing with what I said why is Elon Musk agreeing with what I said it's seems to me that if you disagree now that the volw group are in serious trouble you are really on a ship all on your own here you just really one of those people who doesn't want to accept the fact that disruption is happening is even the Volkswagen group are saying it themselves hello my friends walk of the channel I'm Sam Evans you're watching the electric Viking great to see you I'm sure you've seen the news here multiple headlines um Volkswagen's X CEO facing jail over dieselgate 9 years after the Scandal Volkswagen CEO Oliver Bloom takes on unions as job Cuts Loom many thousands will be lost many now many thousands of jobs in Germany will be lost Volkswagen offends possible German Factory closures says weak sales two plants are empty two plants two entire Factory plants are empty now I thought these were assets right are these assets on Volkswagen's books they are so if you're looking at Volkswagen's share price you're going look at all the assets they've got um that's what Seeking Alpha would tell you oh who who look at all these assets look at these great great assets doesn't actually doesn't take into account at all the fact that two of them are just sitting Idol not producing cars Volkswagen faces Union Fury over Factory closers in Germany and they fired the previous CEO they fired their CEO because he said that they had to fire people in Germany it the Volkswagen group could not sustain having a dead $190 billion which it still has by the way in fact I believe that debts grown $190 billion it has to finance that debt it's going to pay imagine this imagine you had a house worth you paid $190 billion for it it's like amazing yeah it's producing stuff sometimes it is sometimes it isn't but you got to remember you got to pay off that mortgage that's essentially what the fox have to group group have to do for $190 billion of debt but the majority of that debt is what it's debt on internal combustion engine car factories not making EVS on internal prodction engine car factories which factories in Germany could be lost I mean there's speculation on that there's talking about which factories those are and this is really here's the thing getting worse because the fox working group they say that they need to invest two in fact they said they were going to be invest 200 billion into becoming an EV manufacturer primarily EVS plug-in hybrids EVS like by basically Volkswagen group say okay we're going to become the next B the next B isn't that crazy but that's what their goal is you know we're going to take on J jie the fastest growing brand in the world right now why because they're selling EVS more than 100% growth in EV sales so the Volks working group know they need to do this but then they go and invest billions of dollars into or xong into sake Motors Audi is now going to use sake Motors EV platforms they buy a software company for $2 billion in China and then they've got factories closed having to close in Germany cuz their cost too high they invest $5 billion into rivian in the United States Elon Musk tweets this comment he says um where will they get the money in response to H Mars catalog who says Volkswagen is going to save rivan woohoo 5 billion investment also Volkswagen is so broke they want to shut down their own factories in Germany now if all of this sounds a little bit hyperbolic well Aro antlitz who is the Chief Financial Officer who also said that there is a fire at the Volkswagen group he said the factory is on fire when he said the factory he was referencing the business he was saying the business is on fire and it's a crisis he used that exact word crisis so maybe what I was saying wasn't actually all that outrageous in fact I just said it before he said it about a year before he said it Aro anlet outlined Volkswagen's die situation to workers angry at the Volkswagen group's decision to close two plants in order to cut cost because well obviously these these staff at the Volkswagen group they're saying hey a minute you're investing all these billions of dollars into Rivia and all these billions of dollars into China into China why not Germany well here's the thing Germany is expensive labor is expensive in Germany car production is expensive and it's inefficient the L working group do not efficiently manufacture EVS the CEO said that himself right Herbert D said it takes them three times as long to to manufactur an EV versus Tesla three times longer that is an enormous cost burden Volkswagen Finance Chief said it has only one or two years to turn the brand around Ido anlet spelled out the serious nature of Volkswagen situation to workers during a meeting at the firm's Wolfsburg headquarters telling them sales won't return ever to preco levels why well because the Volkswagen group are not going to suddenly turn things around in China they appear to be accepting the reality now that that's never going to happen again the billions of dollars of cash pouring in from China that's well it's ended it's ending the automaker says it will have to close two plants in Germany the first closures in its history to cut costs in the face of a 500,000 unit reduction in annual demand now the Volks working group are not really telling you the full story they're saying a 500,000 unit reduction in annual demand now but what about in 2 years what about in 3 years what about in four years the the automotive industry the pi is shrinking it's only going to get smaller right the number of cars being so worldwide is going to shrink this is a zero sum game and you've got all these automakers from China who are taking a bigger share of the pie what does that mean well it's inevitable the Volkswagen group will continue to lose sales so this is not just 500,000 unit reduction we're talking millions in unit reductions over the next few years and I believe the group are coming to accept that reality there's not much they can do about that if you look past the U golf is 50 celebrations you'll find that at Volkswagen they're admitting they're in a legitimate crisis anlet explained to those present at the meeting that the European car market has has contracted since the pandemic and was unlikely to return to he pre-co levels anytime soon but there's also the recognition that the Volkswagen group sales in China are declining it's a terminal decline for legacy automakers in China I think pretty much every major brand is now accepting that reality this drop in demand and slower than anticipated EV takeup of their EVS now keep in mind EV sales have grown 23% this year but not legacy automaker EVS it's been EVS from companies like zika to be fair their sales have grown 100% various Chinese automakers their sales have grown leap motor their sales have skyrocketed recently in addition Volkswagen say they'll sell around 500,000 fuer cars in a year potentially a million the following year they have a maximum of two years to cut output and reduce costs to steady the ship the group have invested billions into software and it appears to me now that they are hoping the xang software will essentially help them to fix their software problems they'll simply use that there's a joint benching there between xang and Volkswagen group we know xang software is well known in China to be one of the best and the Volkswagen group hoped that that'll fix that that cost they've bled billions of dollars when it comes to their software development costs and their return on investments been very low because they've had huge problems that's the reason why the sales of their electric cars in America have have fallen so fast the id4 sales have fallen so fast because customers have been really irritated by their software and even the Volkswagen CEO in North America said the same thing so this will be the first time ever that the Volkswagen group has closed two factories or even one Factory in its enti entire history we're talking what 100 years they've never done this before and instead of closing one which would be record-breaking they're closing too Volkswagen's employees in Germany are obviously Furious about the closure talk they believe um that they're going to strike IG medal the union are warning of striking of course the thing is there are no more checks coming from China said the CEO it's a direct quote that's not a that's not a Sam Evans Electric Viking quote that's direct there are no more checks coming from China said the CEO of Oliver Bloom at the meeting in Wolfsburg that was a few days ago a reference to Volkswagen struggles to compete with better better priced and better product EVS in China and well that was once a billion multi-billion dollar cash cash count for the group I've mentioned this many times a lot of people say this I've seen this comment hundreds of times oh China doesn't matter matter for the lwag group they won't care these morons are utterly silly and make themselves well they're embarrassing to to listen to because the LW group's profits over the last 10 years 50% of the entire group's profits on average came from China 50% 40% of their sales were in China 50% of their profits so they're making more profit per unit sold in China than any other country in the world and if they were to lose that that profit that cash cow we're talking half of the company's finances half of them if you have nearly $200 billion in debts if most of your factories produce internal combustion cars if you're having to shut some of them down and your cash cow is ending you are in a crisis the automotive industry has changed massively in the volume segment in just a few years said Bloom together we will Implement appropriate measures to become more profitable we are leading Volkswagen back to where the brand belongs that is a responsibility of all of us that sounds more like a plea than a reality that sounds more like a hope a wish than an actual real plan the Volkswagen group right now are all platitudes they're talking to their staff they're saying oh you know we're in trouble but we're going to do this we're going to we're going to save ourselves how what will they do if you were the CEO of this group what would you do thanks for watching