30 Apr 2013

Volkswagen Bank celebrates five years in Ireland

By Padraic Deane On April 30, 2013

Volkswagen Bank celebrates five years operating in the Irish Market this month. Since opening for business in 2008, Volkswagen Bank has provided Irish consumers car loans to the value of €500 million and injected almost €2 billion into the Irish economy in total. Consumer car loans in 2012 surpassed €125 million.

Volkswagen Bank has supported Volkswagen’s growth through the provision of flexible finance packages, which contributed to the brand’s position as number one car brand in Ireland in 2012. It has also offered finance and supports to the Groups other brands Audi, Seat and Skoda.

Commenting on the milestone,Mutlu Gur, General Manager, Volkswagen Bank said: “We made a strategic decision to enter the consumer lending market in 2008 to support the growth of our business in this market. Irish consumers have had to look at alternatives to traditional financial institutions when it comes to financing their motoring. Volkswagen Bank has been in a position to deliver competitive and flexible finance options to consumers and businesses to meet their motoring needs. The finance packages offered by Volkswagen Bank have allowed our brands to continue to increase their share at a time when the industry was falling.”

Volkswagen Group has benefitted from the Volkswagen Bank offering which has allowed the group to increase its market share over a period when the industry has faced tough market conditions. Over the past five years Volkswagen Group has increased its market share from 18.6% in 2008 to 27.6% YTD 2013.

Since opening in 2008, Volkswagen Bank has provided approximately €1.5 billion in working capital to local Irish businesses, through wholesale funding via the Volkswagen Group dealership network. Combined with retail lending the bank has injected over €2 billion into the Irish economy.

Through innovative products, including Personal Contract Plans (PCPs) which Volkswagen bank introduced to the Irish Market in 2009, Volkswagen bank has reduced the average customer contract length from 51 months to 40 months, allowing Irish motorists to pay for their cars in a shorter period of time.

Volkswagen bank now finances 25% of the cars sold by Volkswagen Group Ireland, increasing from a base of just 1% in 2008. The top five models financed by the bank in 2012 were the Volkswagen Golf (20%); Volkswagen Passat (10%); Volkswagen Polo (10%); Skoda Octavia (9%) and the Skoda Fabia (6%).