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The year 2023 has been a year of extremes for VDL Groep, with high points and low points. The lows included the passing of Wim van der Leegte in November, staff reductions at VDL Nedcar, and headwinds in the Buses division. Due to incidental costs in the Auto Assembly division and operational headwinds in the Buses division, the results of the industrial family business headquartered in Eindhoven declined. The high points included the record turnover in the year VDL Groep celebrated its 70th anniversary and the realization of the ambitious investment program enabling customers in VDL's growth markets.
The combined annual turnover in 2023 amounted to €6.354 billion, a 10 percent increase compared to the 2022 annual turnover (€5.752 billion). The net profit, mainly due to one-off charges in 2023, decreased from €298 million to €82 million in 2023. The normalised result, excluding special income and expenses, declined by €29 million to €147 million. The order book stood at €1.857 billion in week 13 of 2024 (excluding the Auto Assembly division), compared to €2.038 billion in week 13 of 2023. This represents a 9 percent decrease. The number of employees has decreased by 272 since the beginning of 2024, bringing the total to 14,973 employees (a decrease of 1.8 percent).
President-director Willem van der Leegte: “Because in 2023 a lot has gone well, we have achieved a historically high turnover. The situation at the Auto Assembly and Buses divisions places a heavy strain on our results, due to the costs of the social plan at VDL Nedcar and challenges at Buses. As a result, we are pulling out all the stops to maintain the investments required by our customers in other activities. The organic sales growth of 2023 confirms that our substantial and long-term investments in innovation (total investment programme 2023: €229 million in properties and other tangible fixed assets and an additional €181 million in research & development) are clearly bearing fruit. We are well positioned in our five growth markets, Hightech, Mobility, Energy, Infratech and Foodtech, to continue providing added value to our customers.”
The turnover in the Supplies division increased from €2.411 billion in 2022 to €2.733 billion in 2023, a rise of 13 percent. The focus on high-quality innovation and digitalization, as well as long-term and stable relationships with customers and other partners, has further strengthened our position. VDL supply companies are increasingly capable of relieving customers in the areas of mechanics, electronics, and software. Because these subsidiaries are located on three continents, they are able to deliver locally to customers worldwide, thus experiencing less impact from geopolitical developments. The Supplies division is profitable. The order portfolio of Supplies stood at €927 million in week 13 of 2023 and was €920 million in week 13 of 2024.
The turnover of the Auto Assembly division has increased: from €2.085 billion in 2022 to €2.489 billion in 2023 (a rise of 19 percent). With the impending end of production for BMW Group, VDL Nedcar has shifted to a single-shift operation as a result of workload reduction due to volume decline on 1 November 2023. The total number of employees has thus decreased from about 4,000 (early 2023) to approximately 2,500 (end of 2023) and currently over 450 colleagues (present). As many employees have been trained over the past years — many have obtained a diploma at VDL Nedcar — a large group of employees who have been laid off in recent months have already found new jobs. The tight labour market and the demand for technically skilled workers have contributed to this. Former employees who have not yet found a new job can go to the so-called Work Centre and, in accordance with the social plan, make use of an individual outplacement process.
The total production volume of VDL Nedcar reached 120,235 vehicles in 2023 (2022: 101,672). VDL Nedcar is operating at a loss. With the current lack of concrete new vehicle projects, after nearly 1.2 million cars produced in Born since 2014, there will be an end to independent car manufacturing at VDL Nedcar for the foreseeable future.
Conversations are ongoing with the approximately 450 colleagues of VDL Nedcar regarding how well they fit into the expansion of our activities in Born, from the assembly of passenger cars to a broad partner in sustainable mobility. The initial activities of VDL Special Vehicles and the Mobility Innovation Centre (MIC) — remanufacturing special vehicles and assembling battery packs — are the early outlines of the aim to achieve, on the one hand, greater independence from market and geopolitical developments, and on the other, a more robust business model. The MIC aligns with VDL Groep's broad mobility strategy: design, electrification, connectivity, autonomous driving, and systems. The planning and zoning-permitting possibilities of the site in Born offer spatial flexibility to accommodate new initiatives. With the expansion of activities, efforts are underway to restore employment in Born over the coming years.
The turnover of the Bus division decreased by 33 percent in 2023, from €454 million in 2022 to €304 million. The main reasons for this are delays in deliveries due to material shortages for the newly developed and series-produced electric city bus introduced in 2023, the new generation VDL Citea. The decommissioning and relocation of production to the new facility in Roeselare (Belgium) also posed challenges. The Bus division is currently unprofitable.
Based on the order portfolio, an increase in turnover is expected for 2024 within the public transport sector. Scaling up production of the new generation VDL Citea will lead to a large number of deliveries to public transport customers in 2024. As a result, the new electric city bus will become increasingly visible in the European streetscape. The order portfolio for the new generation VDL Citea is fully booked for 2024 in 2023. The same goes for the production of the entire range of touring buses. To ensure sustainability and long-term continuity, substantial investments are made in research and development, including a new coach platform. With a team of software engineers, developers, and testers, VDL Bus & Coach also focuses on ‘smart’ mobility issues such as connectivity, energy management, autonomous driving, mobility as a service, and battery as a service, which help to relieve customers and make future transportation more sustainable.
The order portfolio of Buses has decreased over the past 12 months from €490 million in week 13 of 2023 to €453 million in week 13 of 2024.
The VDL companies that form part of the Final Products division achieved a turnover of 828 million euros in the past year, compared to 802 million euros in 2022. This 3 percent increase can be attributed to the fact that our companies in this division are well positioned across the board. The Final Products division is profitable. The order book has decreased over the past 12 months from 620 million euros in week 13 of 2023 to 499 million euros in week 13 of 2024.
The turnover of VDL Groep will decline in 2024 compared to the record turnover of 2023, mainly due to the decreasing revenue at VDL Nedcar. Excluding the Autoassembly division, an organic revenue growth of between 5 to 10 percent is expected. The expectation is that the profit will recover slightly. The projected investments, approximately one billion euros over the next three years, are substantial but necessary to continue supporting customers in VDL Groep's growth markets. To maintain liquidity, tough choices will be made. VDL Groep's order portfolio, which has slightly decreased due to declining demand from the market, still remains at a high level.
The high-tech manufacturing industry is certainly in the home base of VDL Groep, Brainport Eindhoven, on the verge of a significant growth spurt. At the same time, we are facing shortages—whether it concerns talent, space, housing, or energy. These issues must be collectively addressed with united efforts. Positively, the caretaker cabinet has followed through on its promises with a recent financial commitment. Regarding how the Brainport region should handle developments related to that scale-up, all regional partners should continue to engage in dialogue and take responsibility. Through our strength in collaboration, VDL Groep is convinced that we will succeed together.
Communications Director and spokesperson for VDL Groep
E: m.timmers@vdl.nl
Tel: +31 6 14767066
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