Volkswagen outlines plans for U.S. Bond sale post emissions scandal
Category: #world  By Saipriya Iyer  Date: 2018-04-24
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Volkswagen outlines plans for U.S. Bond sale post emissions scandal

Renowned German automaker Volkswagen AG seems to be set to return in the U.S. bond market after its infamous emissions scandal in 2015. VW’s decision is likely to lead to a major turnaround in its business operations, claim sources. Reportedly, the automobile giant has relied upon a USD 24.7 billion short-term loan, asset-backed bonds, and commercial papers for fulfilling its monetary requirements.

Frank Witter, the Chief Financial Officer of Volkswagen Credit Inc., has stated that reviving entree to the bond sector was the key focus of the firm since 2015, during which the FDA found that VW had cheated on the emission tests conducted in the U.S.

Reportedly, one of the reputed names across the automotive sector had last issued U.S. debt during May 2015. The firm has bonds worth USD 1.8 billion that are expected to mature this year, and another slot of bonds estimated at USD 1.75 billion that will mature next year. The company sources have projected that Volkswagen can issue bonds worth a price ranging from USD 1.5 billion to USD 2 billion in the dollar denominated debt in 2018.

Even though VW had EUR 18.03 billion cash at the group level by 2017, the diesel scandal had incurred costs of more than EUR 19.1 billion for the firm during the same year. At that time, the firm had promised to spend EUR 34 billion by 2022 on the digitization of its business operations and mobility. By the end of 2017, VW had overall borrowings worth EUR 163.47 billion along with earnings estimated at EUR 11.63 billion.

The automobile manufacturer is currently adjusting to the rapid changes taking place across the automotive sector, including the latest trend of electric & self-driving cars. One of the key officials of VW has declared that the firm is considering launching new pricing car models that will provide services different from those offered by the firm earlier.



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Saipriya Iyer

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Saipriya Iyer

Saipriya Iyer develops content for Market Size Forecasters, Algosonline, and myriad other platforms. A computer engineer by profession, she ventured into the field of writing for the love of playing with words. Having had a previous experience of 3 years under her bel...

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