Volkswagen AG Supervisory Board discusses Group planning round and changes in senior personnel

The Supervisory Board of Volkswagen AG discussed the current Group planning round at its meeting held today. A central topic was planned investments, especially over the next two years, which are of key importance for the future direction and development of the Volkswagen Group.

Investments within the Volkswagen Group will total € 16.3 billion in 2005 and 2006 and will mainly comprise investments in fixed assets, capitalized development costs and investments in financial assets. This figure represents a further reduction compared with the previous planning round.

Over this period, investments in fixed assets in the Automotive Division will total € 11.8 billion, some € 0.7 billion or 6 percent below the previous planning round. Following the significant reduction in the investment ratio already achieved in 2004, this ratio will be below 7 percent in the period under consideration on a sustainable basis and will therefore be at a competitive level. According to Hans Dieter Pötsch, Board of Management Member responsible for controlling and accounting, "This is a reflection of our intensified efforts to optimize one-off costs within the framework of the ForMotion programme".

In the 2005 and 2006 planning period, the modernization and expansion of the product range will account for the lion's share of investment in fixed assets in the Automotive Division, at € 7.7 billion, and as such the Volkswagen Group will be continuing its model initiative. Apart from investments in production, further expansion is planned in the areas of development, quality assurance, genuine part supply and IT.

The joint ventures in China are not consolidated in the financial statements of Volkswagen Group. In 2005 and 2006, these companies will be investing a total of € 2.1 billion. Reflecting the current market situation and the ongoing staggered expansion of production capacity, investments will be some € 0.6 billion or 22 percent below the corresponding figures of the previous planning round. At its meeting held today, the Supervisory Board of Volkswagen AG appointed Dr. Wolfgang Bernhard as a full Member of the Board of Management of Volkswagen AG with effect from 1 February 2005, following the recommendation made by the Supervisory Board Presidium on 6 October 2004. Dr. Bernhard will initially be a member without portfolio. By 1 January 2006 at the latest, in his capacity as Member of the Board of Management of Volkswagen AG he will assume the role of Chairman of the Volkswagen Brand Board of Management.

At the same meeting, the Supervisory Board also agreed that the appointment of Dr. Jens Neumann as Member of the Board of Management of Volkswagen AG should be terminated by mutual agreement as of 31 December 2004. The Board of Management area of responsibility "Group Strategy, Treasury, Legal Matters and Organization" will cease to exist as a separate unit as of 1 January 2005. The financial responsibilities previously held by Dr. Neumann are to be assumed by Hans Dieter Pötsch, Member of the Board of Management of Volkswagen AG responsible for Controlling and Accounting. In future, the Chairman of the Board of Management of Volkswagen AG, Dr. Bernd Pischetsrieder, will assume direct responsibility for Group Strategy, Legal Matters and Organization. The Board of Management will present the Supervisory Board with details of the allocation of responsibility at its next meeting.