Group Management Report

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Key performance indicators in accordance with the EU Taxonomy regulation

The EU taxonomy defines sales revenue, capital expenditure and operating expenditure as the key performance indicators that must be reported on. Disclosures on taxonomy eligibility are mandatory for fiscal year 2021. We have voluntarily assessed our business activities for taxonomy alignment and already report the relevant figures for passenger cars and light commercial vehicles, and for our hydrogen activities in the Power Engineering Business Area.

The financial figures relevant for the Volkswagen Group are based on the IFRS consolidated financial statements for fiscal year 2021. Where possible, the figures have been directly assigned to an economic activity. In our vehicle-related business, for example, we compiled the financial figures based on the vehicle model and powertrain technology. This applies both to the vehicles themselves and to the corresponding financial services and other services and activities. Only where this was not possible for capital expenditure and operating expenditure, the figures were broken down using allocation formulas. In the vehicle-related business, we based the allocation formulas on the long-term sales plan and the capacity and utilization planning at the individual sites. In the Power Engineering Business Area, we used allocation formulas based on planned sales revenue. This data and planning form part of the medium-term financial planning for the next five years, on which the Board of Management and Supervisory Board have passed a resolution.

Sales revenue

The definition of turnover in the EU taxonomy corresponds to sales revenue as reported in the IFRS consolidated financial statements, which amounted to €250.2 billion in fiscal year 2021 (see also note 1 “Sales revenue” in the notes to the consolidated financial statements).

Of this total, €225.4 billion, or 90.1% of Group sales, was attributable to economic activity 3.3 Manufacture of low-carbon technologies for transport and classified as taxonomy-eligible. This includes sales revenue after sales allowances from new and used vehicles, including motorcycles, from genuine parts, from the rental and lease business, and from interest and similar income, as well as sales revenue directly related to vehicles, such as workshop and other services.

Of the taxonomy-eligible sales revenue, €21.3 billion meet the screening criteria used to measure the substantial contribution to climate change mitigation. This includes all of our all-electric vehicles, the majority of the plug-in hybrids, and the buses meeting the EURO VI standard (Stage E).

Taking into account the DNSH criteria and minimum safeguards, sales revenue of €21.1 billion attributable to our passenger cars and light commercial vehicles, accounting for 8.5% of consolidated sales revenue, was taxonomy-aligned. Of this amount, €14.6 billion, or 5.8% of consolidated sales revenue, was attributable to our all-electric models (BEVs).

In the Power Engineering Business Area, the majority of our taxonomy-eligible sales revenue was attributable to economic activity 3.6 Manufacture of other low-carbon technologies (€2.4 billion). A further €13 million was contributed by economic activity 9.1 Close to market research, development and innovation. Our activities that fall under economic activity 3.2 Manufacture of equipment for the production and use of hydrogen recorded taxonomy-aligned sales revenue of €5 million, taking into account the DNSH criteria and minimum safeguards.

Of the Volkswagen Group’s total sales revenue in fiscal year 2021,

  • €227.8 billion, or 91.0%, was taxonomy-eligible sales revenue and
  • €21.2 billion, or 8.5%, was taxonomy-aligned sales revenue.
SALES REVENUE

 

 

SALES REVENUE

 

SUBSTANTIAL CONTRIBUTION TO CLIMATE CHANGE MITIGATION

 

COMPLIANCE WITH DNSH CRITERIA

 

COMPLIANCE WITH MINIMUM SAFEGUARDS

 

TAXONOMY-ALIGNED SALES REVENUE

Economic activities

 

€ million

 

%1

 

€ million

 

%1

 

Y/N

 

Y/N

 

€ million

 

%1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

A. Taxonomy-eligible activities

 

227,787

 

91.0

 

21,268

 

8.5

 

Y/N

 

Y

 

21,152

 

8.5

Vehicle-related business

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3.3 Manufacture of low-carbon technologies for transport

 

225,380

 

90.1

 

21,264

 

8.5

 

Y/N

 

Y

 

21,147

 

8.5

of which taxonomy-aligned BEVs (passenger cars and light commercial vehicles)

 

 

 

 

 

Y

 

Y

 

14,579

 

5.8

Power Engineering

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3.2 Manufacture of equipment for the production and use of hydrogen

 

5

 

0.0

 

5

 

0.0

 

Y

 

Y

 

5

 

0.0

3.6 Manufacture of other low-carbon technologies

 

2,390

 

1.0

 

 

 

 

 

 

9.1 Close to market research, development and innovation

 

13

 

0.0

 

 

 

 

 

 

B. Taxonomy-non-eligible activities

 

22,413

 

9.0

 

 

 

 

 

 

 

 

 

 

 

 

Total (A + B)

 

250,200

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

All percentages relate to the Group’s total sales revenue.

Capital expenditure

Capital expenditure for the purposes of the EU taxonomy refers to the following items in the IFRS consolidated financial statements: additions to intangible assets, additions to property, plant and equipment, and additions to lease assets and investment property. These are reported in the notes to the 2021 consolidated financial statements in note 12 “Intangible assets”, note 13 “Property, plant and equipment” and note 14 “Lease assets and investment property”. Additions from business combinations, each of which is reported under “Changes in consolidated Group”, are also included. By contrast, additions to goodwill are not included in the calculation.

In fiscal year 2021, additions in the Volkswagen Group as defined above amounted to

  • €9.1 billion from intangible assets,
  • €10.7 billion from property, plant and equipment and
  • €29.1 billion from lease assets (mainly vehicle leasing business) and investment property.

Additions from changes in the consolidated Group, which amounted to €5.1 billion in fiscal year 2021, can also be added to this figure. These mostly related to Navistar. Total capital expenditure to be included in accordance with the EU taxonomy therefore came to €54.0 billion.

All capital expenditure attributable to our vehicle-related business is associated with economic activity 3.3 Manufacture of low-carbon technologies for transport. Taxonomy-eligible capital expenditure for the vehicle-related business amounted to €53.5 billion, or 99.1% of the Group’s capital expenditure.

To determine the substantial contribution in the vehicle-related business, we compiled the financial figures based on the vehicle model and powertrain technology, in the same way as for sales revenue. Where possible, capital expenditure was directly attributed to vehicles. It was included, if the vehicles in question make a substantial contribution to the climate change mitigation objective. We did not include any capital expenditure directly attributable to vehicles that do not meet the screening criteria. Capital expenditure that was not clearly attributable to a particular vehicle was taken into account on a proportionate basis using allocation formulas. In our vehicle-related business, we used model- and brand-specific allocation formulas based on the long-term sales plan and the capacity and utilization planning for the Group companies. Depending on the primary business activity, allocation formulas from the long-term sales plan were used for sales companies, for example, and allocation formulas based on the capacity and utilization planning were used for production companies. This means that capital expenditure on sites that according to our medium-term planning will only produce vehicles meeting the screening criteria for the substantial contribution in the next five years was counted in full via the allocation formula. In contrast, capital expenditure on sites that only produce vehicles not meeting the screening criteria was not counted under the allocation formula. Calculated in this way, capital expenditure relating to vehicles that meet the screening criteria for the substantial contribution amounted to €14.4 billion.

Taking into account the DNSH criteria and minimum safeguards, capital expenditure of €14.2 billion on our passenger cars and light commercial vehicles was taxonomy-aligned. This represented 26.2% of the Group’s total capital expenditure. This figure includes additions to capitalized development costs of €3.5 billion and additions to property, plant and equipment of €3.8 billion for our all-electric passenger cars and light commercial vehicles (BEVs).

Taxonomy-eligible capital expenditure in the Power Engineering Business Area has been allocated to economic activity 3.6 Manufacture of other low-carbon technologies. Capital expenditure was broken down based on planned sales revenue. Taxonomy-eligible capital expenditure amounted to €65 million.

Of the Volkswagen Group’s total capital expenditure in fiscal year 2021,

  • €53.6 billion, or 99.2%, was taxonomy-eligible capital expenditure and
  • €14.2 billion, or 26.2%, was taxonomy-aligned capital expenditure.
CAPITAL EXPENDITURE

 

 

CAPITAL EXPENDITURE

 

SUB­STANTIAL CONTRIBUTION TO CLIMATE CHANGE MITIGATION

 

COM­PLIANCE WITH DNSH CRITERIA

 

COM­PLIANCE WITH MINIMUM SAFE­GUARDS

 

TAXONOMY-ALIGNED CAPITAL EXPENDITURES

Economic activities

 

€ million

 

%1

 

€ million

 

%1

 

Y/N

 

Y/N

 

€ million

 

%1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

A. Taxonomy-eligible activities

 

53,596

 

99.2

 

14,437

 

26.7

 

Y/N

 

Y

 

14,165

 

26.2

Vehicle-related business

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3.3 Manufacture of low-carbon technologies for transport

 

53,531

 

99.1

 

14,437

 

26.7

 

Y/N

 

Y

 

14,165

 

26.2

of which additions to capitalized development costs for BEVs (passenger cars and light commercial vehicles)

 

 

 

 

 

Y

 

Y

 

3,504

 

6.5

of which additions to property, plant and equipment for BEVs (passenger cars and light commercial vehicles)

 

 

 

 

 

Y

 

Y

 

3,760

 

7.0

Power Engineering

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3.2 Manufacture of equipment for the production and use of hydrogen

 

 

 

 

 

 

 

 

3.6 Manufacture of other low-carbon technologies

 

65

 

0.1

 

 

 

 

 

 

9.1 Close to market research, development and innovation

 

 

 

 

 

 

 

 

B. Taxonomy-non-eligible activities

 

443

 

0.8

 

 

 

 

 

 

 

 

 

 

 

 

Total (A + B)

 

54,039

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

All percentages relate to the Group’s total capital expenditure.

Operating expenditure

The operating expenditure reported by us for the purposes of the EU taxonomy comprises non-capitalized research and development costs, which can be taken from note 12 “Intangible assets”. We also include the expenditure for short-term leases recognised in our consolidated financial statements, which can be found in note 33 “IFRS 16 (Leases)”, and expenditure for maintenance and repairs.

The allocation of operating expenditure to the economic activities followed the same logic as that described for capital expenditure.

All operating expenditure attributable to the vehicle-related business is associated with economic activity 3.3 Manufacture of low-carbon technologies for transport and has been classified as taxonomy-eligible.

Where possible, non-capitalized research and development costs were directly attributed to vehicles. It was included, if the vehicles in question make a substantial contribution to the climate change mitigation objective. We did not include any non-capitalized research and development costs directly attributable to vehicles that do not meet the screening criteria. Non-capitalized research and development costs that were not clearly attributable to a particular vehicle were taken into account on a proportionate basis using allocation formulas. For these and other operating expenses, the same allocation formulas were used as for capital expenditure.

Taxonomy-eligible operating expenditure in the Power Engineering Business Area falls under economic activity 3.6 Manufacture of other low-carbon technologies. As with capital expenditure, operating expenditure was broken down on the basis of planned sales revenue.

OPERATING EXPENDITURE

 

 

OPERATING EXPENDITURE

 

SUBSTANTIAL CONTRIBUTION TO CLIMATE CHANGE MITIGATION

 

COM­PLIANCE WITH DNSH CRITERIA

 

COM­PLIANCE WITH MINIMUM SAFE­GUARDS

 

TAXONOMY-ALIGNED OPERATING EXPENDITURES

Economic activities

 

€ million

 

%1

 

€ million

 

%1

 

Y/N

 

Y/N

 

€ million

 

%1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

A. Taxonomy-eligible activities

 

9,911

 

99.2

 

3,463

 

34.7

 

Y/N

 

Y

 

3,265

 

32.7

Vehicle-related business

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3.3 Manufacture of low-carbon technologies for transport

 

9,702

 

97.1

 

3,463

 

34.7

 

Y/N

 

Y

 

3,265

 

32.7

Power Engineering

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3.2 Manufacture of equipment for the production and use of hydrogen

 

 

 

 

 

 

 

 

3.6 Manufacture of other low-carbon technologies

 

209

 

2.1

 

 

 

 

 

 

9.1 Close to market research, development and innovation

 

 

 

 

 

 

 

 

B. Taxonomy-non-eligible activities

 

81

 

0.8

 

 

 

 

 

 

 

 

 

 

 

 

Total (A + B)

 

9,992

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

All percentages relate to the Group’s total operating expenditure.

Plug-in hybrid
Performance levels of hybrid vehicles. Plug-in hybrid electric vehicles (PHEVs) have a larger battery with a correspondingly higher capacity that can be charged via the combustion engine, the brake system, or an electrical outlet. This increases the range of the vehicle.