Volkswagen brand sticks to margin target despite chip crunch

MUNICH - Volkswagen's namesake brand on Monday confirmed its margin target, the division's chief executive said, shrugging off the impact from a shortage of automotive chips as well as higher raw materials prices.

The Volkswagen brand expects an operating margin of 3-4% for 2021. "It stays that way," Ralf Brandstaetter told Reuters at the IAA Munich car show, also confirming the 6% margin goal set for 2023.

At group level, Volkswagen targets an operating margin of 6-7.5%.

Brandstaetter, who also sits on Volkswagen AG's management board, said, however, that Volkswagen was feeling the impact of rising costs for raw materials, adding this would be passed on to customers.

"We are trying to compensate for it with countermeasures."