FRANKFURT (Reuters) -- Volkswagen AG believes the auto industry crisis will last considerably longer than expected and has lowered its previous assumptions for global car market sales by 67 million vehicles for the period through 2018.
"This means a loss for the global market during this period that is equivalent to an entire calendar year," said VW's former head of group sales Detlef Wittig in a joint letter sent by VW's executive board to the automaker's senior managers.
Wittig said the financial and economic crisis is causing long-term structural changes to the auto market, which will lead to sustained lower group deliveries to customers versus VW's previous plan, and consequently a lower financial result.
In the letter, VW CEO Martin Winterkorn says he is sticking to his target of surpassing Toyota Motor Corp. as the world's largest carmaker by 2018.
The letter was obtained by Automobilwoche, a German-language sister publication to Automotive News Europe.
VW finance chief Hans Dieter Poetsch warned in the same letter that "the most critical year of the crisis is ahead of us."
Poetsch said sales in the core European market will be weak in 2010 because of the ending of scrapping bonuses, which offered buyers cash incentives to swap old cars for new models.
"There will continue to be substantial overcapacity and high price pressures in the market," he said.
Poetsch said lower sales will raise the risk of bankruptcy among suppliers and dealers, which, along with the continued worsening of the product mix toward smaller vehicles, is putting Volkswagen's financial results under added pressure.