Volkswagen: Overview – Sustainable Workforce Transformation


5e Annual Volkswagen Group ESG Conference for Investors and Analysts

“Sustainable Workforce Transformation”

Thymian Bussemer – Group HR Strategy & Innovation Manager

Disclaimer

The following presentations as well as the remarks/comments and explanations in this context contain forward-looking statements on the business development of the Volkswagen Group. These statements are based on assumptions about the changing economic, political and legal environment in individual countries, economic regions and markets, and in particular for the automotive industry, which we have made based on information we have and whom we believe to be realistic at the time of going to press. The estimates given involve a certain degree of risk and actual developments may differ from those expected. At the time of preparing these presentations, it is not yet possible to conclusively assess the specific effects of the latest developments in the Russian-Ukrainian conflict on the activities of the Volkswagen Group, nor to predict with sufficient certainty to what extent a further escalation of the Russian-Ukrainian conflict will impact the global economy and industry growth in fiscal year 2022.

Any significant changes in parameters relating to our main sales markets, or any significant changes in exchange rates, energy and other raw materials or raw materials relevant to the Volkswagen Group or parts supply, or deviations in the actual effects of the Covid-19 pandemic compared to the scenario presented will have a corresponding effect on the development of our business. In addition, there may be deviations from our intended business development if the assessments of the factors influencing sustainable value improvement and the risks and opportunities presented evolve in a manner other than that which we currently expect, or if additional risks and opportunities or other factors emerge that affect the development of our business.

We do not update forward-looking statements retrospectively. These statements speak as of the date of publication and may be superseded.

This information does not constitute an offer to exchange or sell or an offer to exchange or buy securities.

06.10.2022 2

Value creation in the automotive industry is shifting towards BEVs and software –

The current workforce structure at Volkswagen does not reflect future “profits”

Revenues based on ICE

Revenue based on BEV

Software-based revenue

Half of the Group’s employees are still engaged in direct production activities

Indirect

327.027

328.241

296.961

309.129

304.745

270.037

Direct

243.772

238.675

204.991

179.067

2009

ten

11

12

13

14

15

16

17

18

19

20

21

Source: K-SPB

06.10.2022

3

Knowledge intensity in the automotive industry will continue to increase –

Need to invest in workforce and skills transformation

Engineering

R&D expenditure in the global automotive industry

-operations

[in billion €]

R&D costs per car in %

Total R&D expenditure

200

7.90%

8.16%

8.85%

ten

100

110.9

114.9

115.1

5

0

0

2018

2019

2020

Source: Statistics 2021

Coding

Software as the central enabler of the car of the future

Lines of code per model [in millions]

1,500

1,000

500

0

2005

2010

2015

2020

2025

Overheated markets for talent in future professions are forcing Volkswagen into critical competition with tech companies and emerging game changers in the automotive sector

Total global talent gap by economy

2030

Total global labor gap as % of labor force

2020

2025

2030

3%

6%

11%

In 2030, …

~ 6.5 million highly qualified talents

shortage1

…~5 million talent shortage

Surplus

Deficit

Significant deficit

Acute deficit

…~4.3 million talent shortages in

0

0-6 million

6-12 million

12-18 million

global technology industry

1 “Highly skilled workers” = post-secondary education, such as college or university, or a diploma from an advanced trades college Source: KornFerry 2018

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Disclaimer

Volkswagen AG published this content on October 06, 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unmodified, on October 07, 2022 07:21:04 UTC.

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Analyst Recommendations for VOLKSWAGEN AG

2022 sales 276B
271B
271B
Net income 2022 17,310M
17,013M
17,013M
Net cash 2022 33,590 million
33,012M
33,012M
PER 2022 ratio 3.81x
2022 return 6.75%
Capitalization 78,938 million
77,581 million
77,581 million
EV / Sales 2022 0.16x
EV / Sales 2023 0.14x
# of employees 641,900
Floating 56.8%


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