VW Group 's 2021 sales fell to lowest in 10 years on chip crunch

BERLIN --  Volkswagen Group vehicle sales dropped to the lowest since 2011 last year after semiconductor shortages restricted production.

Group deliveries fell fell 4.5 percent to 8.88 million in 2021, the company said in a statement on Wednesday.

Only Porsche and Seat showed growth among the group's car brands. Porsche's deliveries rose 11 percent and Seat sales were up 10 percent.

VW brand's deliveries fell 8 percent, Audi's deliveries were down nearly 1 percent and Skoda sales dropped by 13 percent.

VW brand's sales fell most in China, its biggest market, VW saw the biggest decline, with sales down 15 percent. Deliveries in western Europe, the brand's second largest market, fell 5 percent.

"The lagging supply of semiconductors caused limitations in production throughout the course of the year, which ultimately had a major impact on the unit sales figures," VW's sales and marketing boss, Klaus Zellmer said.

An order backlog of 543,000 vehicles in Europe alone, including 95,000 for VW brand's ID battery-electric cars "shows clearly that the demand for Volkswagen vehicles continues to be very high," Zellmer added.

Booming sales of electric cars were a bright spot for the company.

VW brand's global sales of full-electric or hybrid vehicles grew 73 percent to 369,000, amounting to 7.5 percent of total volume, up from 4 percent in 2020.

Sales of full-electric cars increased to 263,000, up 97 percent compared with 2020. Deliveries of plug-in hybrids rose 33 percent to 106,000.

In Europe, electrified vehicles accounted for just under 20 percent of VW brand's deliveries, up from 13 percent in 2020.

"Volkswagen is continuing to press ahead with the transition to e-mobility despite the limited supply of semiconductors," said VW brand CEO Ralf Brandstaetter in the statement. "In a very short time, Volkswagen has reached a top position for BEVs in Europe," he said.

VW brand's most popular battery-electric model worldwide was the ID4 compact crossover with 119,650 units sold, followed by the ID3 with sales of about 76,000.

VW said it expects that the first half to remain "highly volatile and challenging" due to persistent supply bottlenecks for semiconductors. The focus in 2022 is to stabilize production as the year goes on and lower its high backlog of orders as quickly as possible.

This year, the company expects to produce around 43 percent more vehicles at its main plant in Wolfsburg, Germany, its works council boss, Daniela Cavallo, told the German newspaper Wolfsburger Allgemeine Zeitung in December.

However, Manager Magazin also reported in December that Volkswagen Group will still produce fewer cars in 2022 than in 2021, due to persistent semiconductor supply troubles. The automaker is preparing for the possibility that the current chips shortage could last until at least early 2023, the report said.

Bloomberg and Reuters contributed to this report