Volkswagen AG is
considering setting up an IPO for its international trucks division in a bid to
counter Daimler Trucks and Volvo Trucks.
"This is an interesting decision
for Volkswagen as keeping hold of the truck business might help
it smooth out what is a tough period on the car front following the
emissions scandal.” noted Christian Stadler, of Warwick Business School. As a
Professor of Strategic Management he has researched Volkswagen.
He added: “But from the
perspective of the truck division it will probably find it hard to get any
extra capital to grow because the group's focus is on the emissions scandal,
even though this is a good period to for the truck division to grow.
The truck market is going through a difficult period, so acquisitions
would be cheaper.”
Professor Stadler declared that
Volkswagen was “too busy dealing with the emissions scandal” so that by letting
the truck division turn independent might bring in the capital
it requires.
“There is a big growth opportunity for
its brands – MAN and Scania – in the US where they have very
little presence, particularly when compared to its rivals Daimler and Volvo,”
said Professor Stadler. “They are both active in the US and own other brands
there. The market is very different in the US because of the regulations,
but it could acquire a company like Paccar or Navistar International.”
"The other option for VW trucks is
China,” he added. “The market is also expected to be slow, but
Volkswagen is in a relatively strong position in China. It has a dual
strategy, with a partnership with Sinotruk to produce trucks for the mass
market, while its brands MAN and Scania take on the high end of the
market. It could grow in China by organising additional partnerships with
local players.”
Professor Stadler said that Volkswagen has “struggled”
to find synergies between MAN and Scania since it acquired both.
He claimed this might be because MAN
attempted a hostile takeover of Scania in 2006 which eventually failed. It
has produced a non-driving axel for both brands and it
is combining two assembly facilities in Russia into one, but there
has been only limited progress in finding synergies.
“Having said that, I don’t see why
that would be affected if the trucks division became independent, he concluded"
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