Segment reporting

Segments are identified on the basis of the Volkswagen Group’s internal management and reporting. In line with the Group’s multibrand strategy, each of its brands (operating segments) is managed by its own board of management. The Group targets and requirements laid down by the Board of Management of Volkswagen AG must be complied with. Segment reporting comprises four reportable segments: Passenger Cars, Commercial Vehicles, Power Engineering and Financial Services.

The activities of the Passenger Cars segment cover the development of vehicles and engines, the production and sale of passenger cars, and the corresponding genuine parts business. Given the high degree of technological and economic interlinking in the production network of the individual brands, the Passenger Cars reporting segment combines the Volkswagen Group’s individual car brands to a single reportable segment. Furthermore, there is collaboration within key areas such as procurement, research and development or treasury.

The Commercial Vehicles segment primarily comprises the development, production and sale of light commercial vehicles, trucks and buses, the corresponding genuine parts business and related services. Just as in the case of the car brands, there is collaboration within the areas procurement, development and sale. The aim is to achieve further forms of interlinking.

The activities of the Power Engineering segment consist of the development and production of large-bore diesel engines, turbo compressors, industrial turbines and chemical reactor systems, as well as the production of gear units, propulsion components and testing systems.

The activities of the Financial Services segment comprise dealer and customer financing, leasing, banking and insurance activities, fleet management and mobility services. In this segment, combinations occur especially while taking into account the comparability of the type of services as well as the regulatory situation.

Purchase price allocation for companies acquired is allocated directly to the corresponding segments.

At Volkswagen, segment profit or loss is measured on the basis of the operating result.

In the segment reporting, the share of the result of joint ventures is contained in the share of the result of equity-accounted investments in the corresponding segments.

The reconciliation contains activities and other operations that by definition do not constitute segments. It also includes the unallocated Group financing activities. Consolidation adjustments between the segments are also contained in the reconciliation.

Investments in intangible assets, property, plant and equipment, and investment property are reported net of investments under finance leases.

As a matter of principle, business relationships between the companies within the segments of the Volkswagen Group are transacted at arm’s length prices.

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REPORTING SEGMENTS 20171

€ million

 

Passenger Cars

 

Commercial Vehicles

 

Power Engineering

 

Financial Services

 

Total segments

 

Recon­ciliation

 

Volkswagen Group

1

Prior-year figures adjusted (see disclosures on IFRS 15).

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales revenue from external customers

 

168,381

 

27,632

 

3,280

 

30,191

 

229,486

 

64

 

229,550

Intersegment sales revenue

 

18,892

 

7,568

 

3

 

3,541

 

30,004

 

−30,004

 

Total sales revenue

 

187,273

 

35,200

 

3,283

 

33,733

 

259,489

 

−29,939

 

229,550

Depreciation and amortization

 

11,363

 

2,557

 

371

 

6,797

 

21,089

 

−147

 

20,941

Impairment losses

 

704

 

2

 

0

 

574

 

1,280

 

0

 

1,280

Reversal of impairment losses

 

14

 

1

 

 

41

 

56

 

 

56

Segment result (operating result)

 

12,644

 

1,892

 

−55

 

2,673

 

17,153

 

−3,335

 

13,818

Share of the result of
equity-accounted investments

 

3,390

 

83

 

1

 

9

 

3,482

 

 

3,482

Interest result and other financial result

 

−1,964

 

−220

 

−2

 

−180

 

−2,366

 

−1,262

 

−3,628

Equity-accounted investments

 

6,724

 

753

 

18

 

710

 

8,205

 

 

8,205

Investments in intangible assets, property, plant and equipment, and investment property

 

15,713

 

1,915

 

159

 

421

 

18,208

 

104

 

18,313

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REPORTING SEGMENTS 2018

€ million

 

Passenger Cars

 

Commercial Vehicles

 

Power Engineering

 

Financial Services

 

Total segments

 

Recon­ciliation

 

Volkswagen Group

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales revenue from external customers

 

171,028

 

29,388

 

3,605

 

31,592

 

235,613

 

236

 

235,849

Intersegment sales revenue

 

17,059

 

7,269

 

3

 

3,190

 

27,521

 

−27,521

 

Total sales revenue

 

188,088

 

36,656

 

3,608

 

34,782

 

263,134

 

−27,285

 

235,849

Depreciation and amortization

 

12,143

 

2,524

 

378

 

6,523

 

21,567

 

−56

 

21,511

Impairment losses

 

629

 

89

 

 

469

 

1,186

 

110

 

1,296

Reversal of impairment losses

 

156

 

6

 

2

 

98

 

262

 

 

262

Segment result (operating result)

 

12,245

 

1,971

 

−64

 

2,793

 

16,945

 

−3,025

 

13,920

Share of the result of equity-accounted investments

 

3,094

 

213

 

3

 

58

 

3,369

 

 

3,369

Interest result and other financial result

 

214

 

248

 

2

 

−70

 

393

 

−2,039

 

−1,646

Equity-accounted investments

 

6,731

 

971

 

18

 

712

 

8,434

 

 

8,434

Investments in intangible assets, property, plant and equipment, and investment property

 

15,599

 

2,491

 

176

 

510

 

18,776

 

187

 

18,962

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RECONCILIATION

€ million

 

2018

 

20171

1

Prior-year figures adjusted (see disclosures on IFRS 9 and IFRS 15).

 

 

 

 

 

Segment sales revenue

 

263,134

 

259,489

Unallocated activities

 

981

 

948

Group financing

 

24

 

25

Consolidation

 

−28,290

 

−30,912

Group sales revenue

 

235,849

 

229,550

 

 

 

 

 

Segment result (operating result)

 

16,945

 

17,153

Unallocated activities

 

−22

 

10

Group financing

 

−17

 

−16

Consolidation

 

−2,987

 

−3,328

Operating result

 

13,920

 

13,818

Financial result

 

1,723

 

−146

Consolidated result before tax

 

15,643

 

13,673

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BY REGION 2017

€ million

 

Germany

 

Europe/Other markets1

 

North America

 

South America

 

Asia-Pacific

 

Total

1

Excluding Germany.

2

Prior-year figures adjusted (see disclosures on IFRS 15).

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales revenue from external customers2

 

44,333

 

98,420

 

37,686

 

9,988

 

39,123

 

229,550

Intangible assets, property, plant and equipment, lease assets and investment property

 

89,905

 

35,936

 

26,855

 

2,850

 

2,837

 

158,384

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BY REGION 2018

€ million

 

Germany

 

Europe/Other markets1

 

North America

 

South America

 

Asia-Pacific

 

Hedges sales revenue

 

Total

1

Excluding Germany.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales revenue from external customers

 

43,526

 

99,563

 

37,656

 

10,405

 

43,166

 

1,535

 

235,849

Intangible assets, property, plant and equipment, lease assets and investment property

 

95,217

 

36,110

 

29,332

 

2,795

 

2,830

 

 

166,285

Allocation of sales revenue to the regions follows the destination principle.

Since 2018, the allocation of interregional intragroup transactions has been unitary presented according to the economic ownership regarding the segment assets. The prior-year figures have been adjusted accordingly.