Consumer demand not only depends on real factors such as disposable income; it is also shaped by psychological factors that are impossible to plan for.

Increased fuel and energy prices could lead to unexpected buyer reluctance, which could be further exacerbated by media reports. This is particularly the case in saturated automotive markets such as Western Europe, where demand could drop as a result of owners holding on to their vehicles for longer.

In 2012, the effect of unplannable psychological demand factors was exacerbated by the euro crisis and its impact on the global economy and the entire automotive industry. Several automotive markets, particularly in Southern Europe, were in a downward spiral, which in some cases assumed dramatic proportions. We are countering this buyer reluctance with our attractive range of models and in-depth customer orientation.

In addition to buyer reluctance as a result of the crisis, a combination of vehicle taxes based on CO2 emissions – like those already structured in some European countries – and high oil and energy prices is causing a shift in demand towards smaller segments and engines in individual markets. We counter the risk that such a shift will negatively impact the Volkswagen Group’s earnings by constantly developing new, fuel-efficient vehicles and alternative drive technologies on the basis of our drivetrain and fuel strategy. In the rapidly expanding markets of Asia and Eastern Europe, risks arise due to government intervention in the form of tax increases, for example, which could reduce private consumption.

Dependence on fleet customer business

In fiscal year 2012, the percentage of total registrations in Germany accounted for by business fleet customers increased to 12.7% (12.4%). The Volkswagen Group’s share of this segment rose to 47.7% (46.8%). In Europe, Volkwagen’s extensive product range and target group-specific customer care enabled it to extend its successful position in this segment: although registrations by business fleet customers fell by 4.3% in a declining market, the Group’s share increased to 29.3% (28.7%). The fleet customer business continues to be marked by increasing concentration and internationalization. Thanks to its broad product portfolio, however, the Volkswagen Group is well positioned to face the growing importance of the issue of CO2 and the trend towards downsizing. No default risk concentrations exist for individual corporate customers.

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