Volkswagen Considers Sale Of Ducati, Scania, And Man Brands
16 June 2016 - Autoblog
Volkswagen's diesel emissions scandal is driving CEO Matthias Mueller to make an in-depth review of the company's strategies.
According to Bloomberg, Mueller is studying a move away from group-wide growth, the future role of EVs, and how the company's 12 brands and side operations fit into the whole. Mueller will outline the plan to the media on Thursday.
The strategy review could drive VW to sell Ducati, the Scania and Man truck brands, and Man Diesel and Turbo, which builds marine and machine engines. Each sale could generate some much-needed cash for the group, as the company faces down serious fines for its diesel emissions scandal. VW has set aside $18.2 billion to cover fines and repair costs for the 11 million vehicles that use emissions-cheating software, but bolstering its coffers with an asset sale could still be attractive.
"Commercial-vehicle demand is on the rise in Europe so their timing on a sale of the truck operations MAN and Scania might be well timed," Richard Hilgert, a Chicago-based analyst with Morningstar told Bloomberg. "Ducati is a well-revered brand and could be worth a pretty penny."
Volkswagen will also take a page out of the General Motors and Ford play books, rolling all its component manufacturers into a single entity, like GM did with Delphi and Ford did with Visteon, Bloomberg reports. While the new unit would still be vast – 70,000 employees spread across 24 sites around the world – combining its component businesses could increase efficiency and reduce spending. And unlike its American rivals, VW is likely to keep this new entity under its corporate umbrella, rather than spin it off into an independent company.
This isn't the first time we've heard Volkswagen was thinking of selling some of its brands. Back in December, a Reuters report pointed to Man's sale, along with Bentley, Lamborghini, or Ducati, if the company were to default on a $21 billion loan.