Volkswagen Shares: Country’s Priciest Company Sent DAX to Highs
3 minutes for reading
At the beginning of March, I told you that thanks to the analysts of UBS Group AG, Volkswagen shares had hit the levels of five years. Do you think the growth was temporary? Quite the opposite: since then, the stock price of the German carmaker has increased by 51.5% more. I’m excited to find out all the details of what’s going on. Are you in?
Volkswagen shares sky-rocketing
Volkswagen AG (DE: VOWG) shares resumed growth on March 15th. That day, the quotations grew by 3.55% to 239 USD. On March 16th, the increase amounted to 11.55%, so that the quotations reached 266.6 USD.
The positive dynamics not only stayed but enhanced: two subsequent sessions made the stock price 22.7% higher (it reached 327.2 USD). During the month, the increase amounted to 69%.
Volkswagen AG: the most expensive German company
The swift growth of the stock price helped the carmaker win the race with the software-maker SAP SE (DE: SAPG) over the place of the priciest German company.
Market capitalization of VAG reached 163.12 billion USD, while that of SAP SE is 122.86 billion USD. Since the beginning of the year, the car-concern has become 92.4% more expensive, and the software-maker – 4.2% cheaper.
Why did Volkswagen shares grow?
The increase in the stock price was provoked by several loud and ambitious announcements of the company’s management:
- By 2025, the company is planning to become the world’s number one electric carmaker, winning over Tesla.
- By 2030, the share of electric cars in the overall number of vehicles supplied by the company to the EU is planned to reach 60%.
- In 2021, they are planning to sell 1 million electric cars.
- By 2030, they are expecting to launch 6 plants producing batteries for electric cars and extend the network of charging stations worldwide.
- To create the autopilot system and all the necessary software, the number of employees will reach 10,000 people.
How did the growth of Volkswagen shares influence DAX?
With Volkswagen shares growing so noticeably, the German index DAX leaped up impressively high. In March, it has grown by 7.2%, now amounting to 14775.52 points.
The European blue chip index Euro Stoxx 50 has also headed up. It has reached 3867.54 points, getting maximally close to its pre-pandemic values.
Summing up
The management of Volkswagen AG was bold enough to announce its plans to become the leader of the world’s electric car market in the nearest future, which made the stock price of the German carmaker grow. In March, the growth has amounted to 69%.
Such a drastic change made the concern the most expensive German company and pulled the DAX index to the high of 14775.52 points. Analysts note that VAG will now have to stick to the plan for the dynamics to remain positive.
