Volkswagen CEO Herbert Diess has alerted his managers that he expects a significant market upturn for the beginning of 2021, in spite of the semiconductor shortages currently plaguing the industry.
The shortage is poised to significantly affect first-quarter targets and VW and other major automotive players have already slashed production in the face of supply chain issues from predominantly Asian suppliers.
Read more: VW looks to claim damages over semiconductor shortage
Diess informed his executives in an internal webcast on Monday he expects the global economy will see a major recovery in the second half of the year.
The webcast was their first formal meeting of the year and was attended by several new board members.
VW hopes to sell at least 600,000 purely battery-powered cars in 2021 with their new model, the ID.4, accounting for 150,000.
Semiconductors are vital in the production of electric-powered vehicles, and many suppliers are hoarding stocks for electronics companies, who have seen an influx of demand owing to the pandemic.
Executives in the company closed 2020 by hashing out a new plan to protect margins and boosting sales volumes.
In the meeting, Diess said: “I am looking forward to 2021 and I expect that the global economy will see an upturn in the second half of the year, by which time we should see ongoing vaccination programs take effect.
“Then I expect people to buy more cars. We should prepare for a significant upturn.”
VW recently lost its crown as the top-selling global automaker for the first time in five years, losing to Japanese rival Toyota.
Read more: Toyota surpasses VW as top carseller spot for 2020
The Japanese company noted sales losses of around 11.5% compared to VW's 15.2%.
VW still hold the top spot for Europe and saw a 2.5% rise in Frankfurt trading on Tuesday, with an estimated total worth of €85 billion.
Diess and his executives hope to lower fixed costs and material expenses.
He added: “We have set ourselves the target of reducing overheads by 5% and material costs by 7%. This is necessary so that we have the strength to finance topics important to our future ourselves since our market capitalization and governance structure do not allow us to raise additional equity."
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