Volkswagen AG's financial-services division forecast a substantial drop-off in annual profit as better access to semiconductors and other components leads to normalization in the used-car market.
Earnings in 2023 are expected to be significantly below last year's level, Volkswagen Financial Services said in a statement Tuesday. Operating profit slipped to €5.6 billion ($6 billion) last year from a record result in 2021.Shortages of chips and other disruptions to supply chains and logistics have constrained auto manufacturers' pandemic recovery efforts, driving up prices of both new and used vehicles. Elevated residual values have been a boon to the in-house lending units that carmakers and their dealers tap to help consumers finance car purchases and leases, though their earnings have widely been expected to fall off this year.
"2022 was once again an exceptional financial year strongly affected by special factors," Frank Fiedler, chief financial officer of Volkswagen Financial Services, said in the statement. "It can be anticipated that a repeat of such a result will not be possible in the short term."