What the Media Forgets About Volkswagen

Audi: The 'other' (more profitable) Volkswagen...

Audi: The 'other' (more profitable) Volkswagen...

QUESTION

The media forgets to mention that the problematic Volkswagen engines are also in Skoda, Audi and SEAT. What is your thought on this? - Palo

ANSWER

Palo, well spotted. Volkswagen is going to do everything it can do distance its other brands  - but especially distance Audi - from its criminal behaviour in 'dieselgate'. Read the full story and watch the video report on dieselgate in my exclusive report: How Volkswagen Betrayed the World >>

The reason is really simple: in Audi's case in particular they’re protecting the profit. (It might be more correct to suggest they're insulating themselves from greater losses.

PROFIT & PRODUCTION

Volkswagen Group

Annual production, 2014: 10.2 million vehicles
Share of production: 100 per cent

Profit, 2014 (Euros): 11.1 billion
Share of the profit: 100 per cent
Profit per vehicle (Euros): 1088

Audi

Annual production, 2014: 1.8 million vehicles
Share of production: 18 per cent
Profit, 2014 (Euros): 5.2 billion
Share of the profit: 47 per cent
Profit per Audi (Euros): 2889

In 2014, the Volkswagen Group sold 10.2 million vehicles in total - across all the brands - and it made 11.1 billion Euros in profit. Audi’s share of production was just 1.8 million vehicles - but the profit was a massive 5.2 billion Euros. So Audi generates 47 per cent of Volkswagen Group’s profits, and it manages to do that with just 18 per cent of the cars.

If you’re not big on mathematics, it’s like this: If you take Audi out of the Volkswagen Group’s balance sheet, they’re making an average profit of about $1100 Australian dollars per car. And if you think about Audi in isolation, it’s making $4400 Australian dollars in profit per cer, on average. So, Audi is four times as profitable - per car - on average, compared with the rest of the Volkswagen Group. This is why the Volkswagen Group is doing everything it can to keep Audi apparently at arm’s length from this morally reprehensible scandal - even though Audi is actually in it up to its neck.

Frankly it’s amazing how far you can pump up the price of a Volkswagen Golf when you primp its hair and makeup, and slap four rings on, front and rear. And then sell it to upmarket idiots as an A3. So Audi is absolutely critical to the Volkswagen Group’s profits during this fiasco. See below for the truth about A3 and Golf - if you landed here this morning from Alpha Centauri. you would not be able to tell them apart - except of course for the price. The same car, essentially - only nearly $10,000 more if you want the four rings up the pointy end. That's an incredible 30 per cent more ... and it's nearly all profit.

Separated at Birth? Audi A3 and Volkswagen Golf

Volkswagen Golf
Comfortline 92 TSI Auto
$27,990 (rrp)

5-door hatch
Length x width x height: 4349 x 1799 x 1491 mm
Wheelbase: 2620 mm
Track (F/R): 1540/1512 mm
Tare mass: 1233 kg
Tow capacity: 1400 kg

1395 cc DOHC inline four-cylinder
Min octane: 95 RON
Power: 92 kW @ 6000 rpm
Torque: 200 Nm from 1400-4000 rpm
Economy: 5.4 L/100km
Trans: 7sp DSG

Power/weight: 74.6 W/kg
0-100 km/h: 9.1 seconds

Audi A3
Attraction
$36,500 (rrp)

5-door hatch
Length x width x height: 4310 x 1785 x 1425 mm
Wheelbase: 2636 mm
Track (F/R): 1535/1506 mm
Kerb weight: 1300 kg
Tow capacity: 1400 kg

1395 cc DOHC inline four-cylinder
Min octane: 95 RON
Power: 92 kW @ 6000 rpm
Torque: 200 Nm from 1400-4000 rpm
Economy: 4.9 L/100km
Trans: 7sp DSG

Power/weight: 70.8 W/kg
0-100 km/h: 9.3 seconds

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