Volkswagen : Q1 Report 2023

Interim Report

January - March 2023

1	UPDATED INFORMATION	6	INTERIM MANAGEMENT	33 BRANDS AND	37 INTERIM CONSOLIDATED FINANCIAL
			REPORT	BUSINESS FIELDS		STATEMENTS (CONDENSED)
1	Key Facts	6	Volkswagen Shares		37	Income Statement
2	Group News	8	Business Development		38	Statement of Comprehensive Income
		21 Results of Operations, Finan-		39	Balance Sheet
			cial Position and Net Assets		40	Statement of Changes in Equity
		31	Outlook		41	Cash Flow Statement
					42	Notes to the Interim Consolidated
						Financial Statements
					66	Review Report

Key Figures

VOLKSWAGEN GROUP

		Q1
		2023			20221		%
Volume Data2 in thousands
Deliveries to customers (units)	2,041		1,898		+7.5
Vehicle sales (units)		2,124		1,995	+6.5
Production (units)		2,273		2,044	+11.2
Employees (on March 31, 2023/Dec. 31, 2022)	676.9		675.8	+0.2
Financial Data (IFRSs), € million
Sales revenue	76,198		62,711	+21.5
Operating result before special items		5,747		8,458	-32.1
Operating return on sales before special items (%)		7.5		13.5
Special items	0		-130	x
Operating result		5,747		8,328	-31.0
Operating return on sales (%)		7.5		13.3
Earnings before tax		6,453		8,916	-27.6
Return on sales before tax (%)		8.5		14.2
Earnings after tax		4,730		6,743	-29.9
Automotive Division3
Total research and development costs		5,071		4,359	+16.3
R&D ratio (%)		8.0		8.5
Cash flows from operating activities		7,576		5,800	+30.6
Cash flows from investing activities attributable to operating activities4		5,332		4,309	+23.7
of which: capex		2,458		1,703	+44.3
capex/sales revenue (%)		3.9		3.3
Net cash flow		2,244		1,491	+50.5
Net liquidity at March 31		38,441		31,065	+23.7

1. Prior-yearfigures adjusted (see disclosures on IFRS 17).
2. Volume data including the unconsolidated Chinese joint ventures. These companies are accounted for using the equity method. Prior-year deliveries have been updated to reflect subsequent statistical trends.
3. Including allocation of consolidation adjustments between the Automotive and Financial Services divisions.
4. Excluding acquisition and disposal of equity investments: Q1 €4,954 (3,848) million.

This document is an English translation of the original report written in German. In case of discrepancies, the German version shall take precedence. All figures shown in the report are rounded, so minor discrepancies may arise from addition of these amounts. The figures from the previous fiscal year are shown in parentheses directly after the figures for the current reporting period.

Specified vehicle ranges correspond to results obtained through the Worldwide Harmonized Light Vehicles Test Procedure (WLTP) on the chassis dynamometer. WLTP value ranges for series- produced vehicles may vary depending on the equipment. The actual range will deviate in practice depending on various other factors.

Updated Information

Key Facts

Key Facts

• Deliveries to customers of the Volkswagen Group up year-on-year at 2.0 (1.9) million vehicles; growth in Western Europe, North and South America, declines in Asia-Pacific as well as Central and Eastern Europe
• Deliveries of all-electric vehicles to customers up 42.1%; their share of the Group's total deliveries rises to 6.9 (5.2)%
• Group sales revenue up 21.5% on the prior-year figure to €76.2 billion
• Operating result down year-on-year at €5.7 (8.3) billion; effects from the fair value measurement of derivatives to which hedge accounting is not applied of
  €-1.3 (+3.2) billion; improvements particularly in volumes and price positioning
• Profit before tax drops to €6.5 (8.9) billion; profit after tax decreases by €2.0 billion to €4.7 billion
• Automotive Division's net cash flow improves to €2.2 (1.5) billion; capex ratio of 3.9 (3.3)%
• Net liquidity of €38.4 billion in the Automotive Division; includes cash outflow for the special dividend in connection with the IPO of Porsche AG

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Updated Information

Group News

Group News

NEW PRODUCTS AND TECHNOLOGIES

The Volkswagen Group and its brands presented new vehicles and technologies in the first quarter of 2023. At the Chicago Auto Show in February 2023, the Volkswagen Passenger Cars brand unveiled the new

Atlas and Atlas Cross Sport. The upgraded models, available as a seven-seater or five-seater, offer the latest technologies, an attractive interior design and an agile powertrain. The interior of the new Atlas family models has been significantly enhanced with high-quality materials. High-end comfort functions come as standard. The standard features include a 12-inch infotainment display, the Volkswagen Digital Cockpit Pro, IQ.DRIVE driver assistance technology and improved connectivity solutions. The high-torque and efficient four-cylinder turbocharged engine with direct injection produces 200 kW (269 PS). Its power output matches that of its predecessor but with increased torque and a wider RPM range. Driving comfort and acceleration have been further improved.

In March 2023, the Volkswagen Passenger Cars brand celebrated the world premiere of the new generation of the ID.3. From outside, the all-electric compact class bestseller has a fresh, sharper look. The front of the vehicle, which includes a new bumper, has a confident, friendly appearance. At the rear, the two-part taillight clusters now also illuminate within the boot lid for the first time. The interior combines modern design with sustainable materials. The microfiber material, Artvelours Eco, is used for the door trims and seat covers. This fabric is made of 71% recyclate yet has the same look, feel and durability as traditional materials. All materials used for the interior are animal-free. The modern and intuitive controls are based on the latest software generation and can receive over-the-air updates. The compact 5.3-inch driver display is controlled via the multifunctional steering wheel. In the center of the console is a 12-inch touch display fitted as standard, which controls the navigation, phone, media, assistance systems and vehicle set-up. The optional augmented reality head-up display projects information such as dynamic navigation instructions onto the windscreen - clear and correctly positioned from the driver's perspective, these are superimposed on the surroundings ten meters in front of the vehicle. Along with the tried-and- tested adaptive cruise control (ACC) and Lane Assist systems, the new ID.3 is available with the optional Travel Assist, which uses swarm data.

In the age of e-mobility, the Volkswagen Passenger Cars brand continues to write the success story of the compact car. In mid-March, it gave a first preview of an all-electric Volkswagen for less than €25,000: the ID. 2all concept car showcases a new Volkswagen design language and is the first MEB vehicle with front- wheel drive. The electric motor has a power output of 166 kW (226 PS), and the vehicle has a range of up to 450 km. Innovative technological features include Travel Assist, IQ.LIGHT and the e-route planner. The

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Updated Information

Group News

production version of the ID. 2all will be based on the so-called MEB Entry platform, which will set new standards in technology and everyday practicality. The vehicle is one of ten new electric models that Volkswagen plans to put on the market by 2026.

Lamborghini celebrated the premiere of the new Revuelto in March 2023. The Revuelto continues the Italian super sports car manufacturer's V12 heritage and takes it into a new electrified future as the brand's first production hybrid. It features a new design and powertrain, maximum-efficiency aerodynamics and a novel carbon frame design. Its power output of 747 kW (1015 PS) is delivered from a completely new 12-cylinder combustion engine, which works alongside a new dual clutch gearbox and three electric motors. These are powered by a lithium-ion battery and pave the way for a fully electric driving mode.

Volkswagen Group Technology brings together the battery, charging and electric component activities across the Group and supports the Group brands as an in-house technology supplier. As part of the Tech Day 2023, Volkswagen Group Technology gave a preview of upcoming innovations in electric vehicles in the first quarter. This focused on the electric drive system of the future. Volkswagen is taking all the key components into its own hands. In addition to batteries and electric motors, it is now developing pulse inverters and thermal management systems internally. This will bring considerable efficiency and cost advantages: up to 20% more efficiency is possible through the optimal combination of individual components alone.

AWARDS

In January 2023, the CUPRA brand won a double victory with its Formentor in the Auto Bild magazine sports cars of the year 2022 award, beating 24 other SUVs. In the SUVs (production) category, readers voted the model the winner in the import and overall rankings.

Also in January 2023, the Volkswagen ID. Buzz was the overall winner of "What Car? Car of the Year Award 2023". Other Volkswagen Group models secured wins in five of the other 18 categories.

At the end of January 2023, MAN Truck & Bus together with Axel Springer Corporate Solutions GmbH & Co. KG won the golden FOX AWARD in the Auto category for their Electrifying Europe Tour. This European tour covered a distance of almost 2,500 kilometers through eight countries with MAN Lion's City 12 E, demonstrating the performance of all-electric city buses. Launched 12 years ago, the FOX AWARDS are presented to the winners by a jury of media experts.

Several Volkswagen Group models won categories in the "Best Cars 2023" awards from auto motor und sport magazine in early February 2023. The Volkswagen Passenger Cars brand impressed with the T-Roc in the small SUVs/crossovers category. The Polo was another overall winner for the brand in the small cars category. In the import rankings for this category, the ŠKODA Fabia took first place. With its Octavia, ŠKODA also won the compact class category for import vehicles. Porsche prevailed against its competitors in the upper mid-size category with the Taycan. The Porsche brand also secured top place in the sports cars category with the 911 and in the convertibles category with the 911 Cabrio/Targa. The Porsche Macan won the large SUVs/off-roaders category. The Bentley Continental GT led the import rankings in the luxury class. The ID. BUZZ from Volkswagen Commercial Vehicles took first place in the vans category. In the import rankings for the compact SUVs/off-roaders category, the CUPRA Formentor was the victor. The Lamborghini Urus triumphed among import vehicles in the luxury SUVs/off-roaders category. A total of more than 100,000 readers chose their favorites in 13 vehicle categories.

Also in February 2023, MAN Lion's City 10 E was crowned "Bus of the Year in Spain" at the National Transport Awards 2023 in Madrid. A jury of professionals and sector experts voted for the year's best vehicles in a total of ten categories.

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