Dividends and US CEO talks about reviving VW’s image

The auto market is a bell weather for the economy and there will be many analysts projecting the future. Some people have a more vested interested because as head of a company they need to invest billions of money to tool and retool auto plants.

In an article by Tom Krisher of the Associated Press, the President of VW of America since 2018 Scott Keogh was interviewed.

The first question with VW is there was a scandal of emissions and 30% of people said they would never buy VW again, now the number is down to 13%.

13% sounds high, but you have to remember every brand has a 8 to 9% avoidance. The goal is not 0% but to be around 7%.

The market in the US will probably be down 14 -15% in 2020 to , with 14.5 million vehicles sold and VW having a 10% share. In 2021, the expectation is 15.4 million.

The trend for both shoppers and dealers to being digital is going to stay because it is more transparent and clear.

The electric market is 2% but every single survey 30 -40% of consumers says electric will be my next car.

Linking to dividend paying stocks, auto companies are in a very interesting area, they see the internal combustion engine is changing and electric vehicles are going to be a growth area but there is time lag between the 2 segments. Will we always have internal combustion engines? how many have to be produced for economies of scale? what is the price point which tips the market? All very important issues which someone has to make a decision on. We know the government under President Biden will encourage more electric, but when will consumers make the decision? On one hand you want your manufacturing company to be nimble and quick, but there are capital investments to be made, do you agree with your companies’ investment strategies?

There are more questions than answers, till the next time – to raising questions.

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