Calidad de vida, subsidio y política pública

COUNTRIES

CHINA, INDIA, MALAYSIA, SINGAPORE, TAIWAN

product was launched in the market. Varying regional growth rates are likely in the coming years. While growth will slow down in the coastal regions due to increasing traffic density and entry restrictions, interior regions will offer additional growth poten-tial. The subsequently necessary expansion of the brands’ dealer network will be actively supported by the provision of dealer financing.

The cooperation with the brands of the Volkswagen Group in Taiwan was further boosted by the wide range of products in both the financing and insurance sectors. This had the extremely positive effect of very quickly providing the brands with customized solutions for increasing vehicle sales. The highly successful insur-ance brokerage business, with a volume more than 32,000  new contracts, now makes a significant contribution to the overall result of Volkswagen Financial Services Taiwan.

Volkswagen Finance Pvt. Ltd. in Mumbai besides its offer of new car financing and dealer financing expanded its product range for dealers in the areas of spare part and used car financing. The introduction in the private customer business of new mobility products that offer customers all-in packages and worry-free driving, resulted in portfolio growth of 36 percent (around 12,000 contracts).

In Malaysia, following the incorporation of Volkswagen Capital Advisory Sdn Bhd business operations were started in what is now the 49th market for Volkswagen Financial Services. As a wholly owned subsidiary of Volkswagen Financial Services AG, the company brokers vehicle financing from Maybank and insur-ance from three selected insurinsur-ance companies for all Volkswagen Passenger Cars through its own retail sales staff at the dealers. It should be noted in particular that the financing services are designed to conform with the rules of Islam.

F L E E T C U STO M E R S A N D C A R S H A R I N G

Headquartered in Beijing, China, Volkswagen New Mobility Services expanded its leasing services to a total of 16  Chinese metropolitan

areas in 2014. The leasing portfolio grew by 196 percent as a result of the successful participation in nationwide tender off ers. In this context, steadily increasing licensing restrictions for new vehicles in cities such as Beijing, Shanghai, Guangzhou and Tianjin pose major challenges.

As a further business area of Volkswagen New Mobility Services, additional experience was garnered in corporate car sharing.

The station-based B2B car sharing offer in Beijing enabled selected companies with pilot operations to secure their mobility needs starting at one hour.

“The growth markets in the ASEAN region are becoming increasingly important for the Volkswagen Group. Volkswagen is already manufacturing some models in Malaysia and is expanding its dealer

network as a result. In our role as a captive provider of financing services, we are following the Volkswagen Group’s brands and are now continuing to pursue our global growth strategy by entering the

Malaysian market. We aim to promote the unit sales of the Volkswagen Group brands and strengthen the relationship between

dealers and customers by offering attractive products.”

REINHARD FLEGER

REGIONAL MANAGER CHINA, INDIA AND ASEAN

G E N E R A L D E V E L O P M E N T O F B U S I N E S S

For the countries of the international region, 2014 was charac-terized by the strategic growth dimensions of markets, brands and products and the financial services business was successfully expanded.

In 2014, the Australian gross domestic product grew compared to the previous year and the annual growth rate of 2.6 percent was roughly equivalent to the average of the last 25 years. The total sales volume of the Volkswagen Group’s brands exceeded the pre-vious year’s level. The vehicle financing business remains highly competitive with financing rates of more than 90 percent.

Despite shrinking exports to China, the Korean economy once again posted year-on-year growth. The demand for imported vehicles is again on the rise in Korea and the import market for passenger cars grew by around 25 percent compared to the previ-ous year. Both Audi and Volkswagen Passenger Cars were able to increase their vehicle sales from 2013.

The annual growth rate of the Japanese economy remains weak.

The import market contracted slightly in the last reporting year, in particular due to an increase in the consumer tax from five to eight percent. Nevertheless, the Volkswagen Passenger Cars and

Audi brands were once again able to increase their vehicle sales figures year-on-year.

The South African economy was only able to generate very moderate growth. The overall new car market contracted slightly compared to the previous year due to a weaker rand.

P R I VAT E C U STO M E R S / C O R P O R AT E C U STO M E R S/ F L E E T C U STO M E R S

Year-on-year, Volkswagen Financial Services Australia (Pty) Ltd.

continued to grow in all product segments in a generally competi-tive market environment: Last year, nearly one in three newly registered Group vehicles was financed or leased through the Australian subsidiary. The previous year’s results were also ex-ceeded in the service and insurance product areas, with the in-surance area posting gains of as much as 25 percent. Increased cooperation with the Group brands and retail partners provided the basis for the positive business trend. Structural investments that were made in various areas over recent years have also paid off: The “Audi Choice” residual value product, a flexible three-option financing model, was introduced for the Audi brand at the beginning of 2014. Volkswagen Financial Services Australia (Pty) Ltd. also began doing business with fleet customers in the middle of the year, thus paving the way for further growth, as this custom-er group accounts for around 30 pcustom-ercent of the ovcustom-erall market.

International

COUNTRIES

AUSTRALIA, JAPAN, SOUTH AFRICA, SOUTH KOREA

In Korea, Volkswagen Financial Services Korea Co. Ltd. contin-ued on its growth course in 2014. It further increased its already high share of the financing/leasing of newly registered vehicles compared to the previous year, with nearly half of all newly regis-tered Group vehicles being financed or leased through the Korean financial services company. The already close collabora-tion with both Group brands was further intensified within the scope of joint structural and optimisation projects intended to sustainably increase the company’s competitiveness. The MAN Truck & Bus financing business also delivered a strong perfor-mance in its first full financial year.

Volkswagen Financial Services Japan Ltd. grew the volume of new contracts year-over-year in 2014. It further increased its overall high share of the financing and leasing of newly registered vehicles to nearly 40 percent. In the year under review, the Japa-nese subsidiary added financial services for the Ducati brand to its service portfolio. Since the beginning of the year, products such as balloon and traditional instalment credits have been offered to private end customers by the dealer network under the Ducati Financial Services brand. Financing campaigns custom-ized to end customers were successfully placed in the market in collaboration with the Ducati Japan brand.

Volkswagen Financial Services South Africa (PTY) Limited launched its nationwide business operations on March 1, 2014.

Volkswagen Financial Services AG owns 51 percent of the shares of the new financial services provider and the South African com-pany FirstRand Limited holds 49 percent through WesBank, its business area active in the financing of vehicles and various capital goods. The portfolio of products and services offered by

Volkswagen Financial Services South Africa currently comprises financing and leasing products such as insurance for the end customer and retail purchase financing. The first 10 months of nationwide business operations were extremely promising, and more than 30,000 new and used cars were financed in this period.

“The established countries in the international region were able to successfully hold their course in 2014 and generated consequently

growth in the brand and product dimensions. Further growth potential was developed by entering the South African market. By maintaining a close cooperation with the Group brands at various levels and business areas and consistently focusing on the needs

of our customers, we have laid the essential groundwork for sustained success.”

OLIVER SCHMITT

REGIONAL MANAGER INTERNATIONAL

37

FUNDAMENTAL INFORMATION ABOUT THE GROUP

39

REPORT ON ECONOMIC POSITION

52

VOLKSWAGEN FINANCIAL SERVICES AG

(CONDENSED, ACCORDING TO THE GERMAN COMMERCIAL CODE)

54

REPORT ON OPPORTUNITIES AND RISKS

69

REPORT ON POST-BALANCE SHEET DATE EVENTS

70

CORPORATE RESPONSIBILITY

80

REPORT ON EXPECTED DEVELOPMENTS

CONTENTS

B U SI N ES S M O D E L

Over the years, the companies in the Volkswagen Financial Services AG Group have evolved increasingly dynamically into providers of comprehensive mobility services. As in the past, the key objectives of Volkswagen Financial Services AG include:

> Promotion of Group product sales in the interest of the

Volkswagen Group brands and the partners appointed to distrib-ute them, and strengthening of customer loyalty to the Volks-wagen Group brands along the automotive value chain,

> Acting as a service provider for the Volkswagen Group and its

brands, with optimized products, processes and information sys-tems,

> Intensification of the cross-border transfer of experience and

know-how, and close cooperation with the national companies,

> Utilization of synergies from close cooperation with the Group

Treasury of Volkswagen AG for the best possible refinancing.

ORGA N IZATI ON OF TH E VO L KSWAG E N F I NA NC IAL S ERV I C E S AG G RO U P

The companies of the Volkswagen Financial Services AG Group provide financial services to the following customer groups: pri-vate/corporate customers, fleet customers and direct banking customers. The close integration of marketing, sales and customer service focused on customers' needs goes a long way towards keep-ing our processes lean and our sales strategy efficient. Volkswagen Financial Services AG consolidated all aftersales matters in a sepa-rate key account structure for purposes of exploiting the services business to optimal effect.

Following the in-depth analysis in 2013 of the tasks of all companies in the Volkswagen Financial Services AG Group in Germany, the clear organizational, legal and personnel separation of the func-tions and areas of activity between the holding company and the German market was introduced as of January 1, 2014. The aim of this restructuring is to outline clear responsibilities, avoid duplicat-ed functions and leverage further potential for optimization. A further consequence was that in 2014 all of the holding functions adapted to the new structure and division of responsibilities. It was also necessary for them to review their respective worldwide re-sponsibility and make adjustments where necessary.

The IT strategy was redefined and the structure adjusted ac-cordingly with effect from July 1, 2014. This new structure will promote and support the achievement of the core targets set out in the IT strategy. These core targets include strengthening pro-ject management, creating a key account structure, and focusing application development on the provision of sustainable and stable solutions.

I NTER NA L M A NAG EM E NT

The company’s control variables are calculated based on IFRS and presented in its internal reporting. The most important non-financial control variables are penetration, current contracts and new contracts. The key financial control variables are the business volume, deposit volume, the operating result, return on equity and the cost/income ratio.

Fundamental information