Return on investment (ROI) and value contribution in the reporting period

The operating result after tax for the Automotive Division, including the proportionate operating result of the equity-accounted Chinese joint ventures, increased to €14,078 (11,740) million in fiscal year 2022. The year-on-year improvement resulted primarily from favorable price positioning and positive changes in the product mix. Negative impacts during the reporting period arose primarily from a decline in unit sales as a result of parts supply shortages, higher product costs (especially for commodities), negative impacts from the Russia-Ukraine conflict, and the recognition of negative special items in the reporting period. The effect of purchase price allocation on earnings and assets is not taken into account as this cannot be influenced by management in the course of business operations.

At €117,412 (113,386) million, invested capital increased slightly in the reporting year compared with the prior year.

The return on investment (ROI) is the return on invested capital for a particular period based on the operating result after tax. Due to the improved operating result, the ROI of 12.0 (10.4) % exceeded both the prior-year figure and our minimum required rate of return on invested capital of 9%.

At €9,702 (6,984) million, the opportunity cost of capital – invested capital multiplied by the cost of capital – was strongly up on the previous year. Improvements in the operating result after tax, net of the opportunity cost of invested capital, led to a positive value contribution of €4,376 (4,756) million, which fell short of the prior-year figure, mainly because of the increased cost of capital.

More information on value-based management is contained in our publication entitled “Financial Control System of the Volkswagen Group”, which can be downloaded from our Investor Relations website: www.volkswagenag.com/en/InvestorRelations/news-and-publications/More_Publications.html.