VW Expected to Increase Its Investment Target image

Analysts expect VW to raise its planned investment by 12% to 70 billion euro until 2017.

Today VW’s 20-member supervisory board will decide on the automaker’s spending targets for 2013-2017, including investments in new vehicles and plants. Although VW is not affected by the European crisis as much as rivals Fiat and PSA Peugeot Citroen, it is still difficult for the company to find the money to achieve its purpose. Analysts expect VW to raise its spending target with 12% to 70 billion euro ($89.73 billion) in the following five years, for all its 12 brands, compared with 62.4 billion for the 2012-2016 agreed in 2011.

“Pressure to cut costs is definitely higher in such difficult times, but we must keep up spending to meet our expansion goals,” Peter Mosch, top labor leader of VW’s Audi division and a member of VW’s supervisory board, told Reuters.

If VW will invest more in technology and products it will manage to consolidate its lead over Fiat and PSA which have to postpone their vehicle programs, platform revamps and engine technologies until they get back on their feet in Europe. The fact that VW has strong sales outside Europe, allowed the automaker to offer low-price deals on the continent and increase its share to a almost a quarter.