The mood in the automotive industry is grim, particularly in Wolfsburg. Vehicle sales are sluggish, and revenues are declining. To stabilise and improve profitability, Volkswagen is putting the brakes on costs. Following profit warnings this year, layoffs and the potential closure of plants in Germany are now on the table. Already decided cost-cutting measures also impacting capital markets communications.

„We are undergoing an internal restructuring at the headquarters as part of the cost programme“, Rolf Woller, head of Treasury and Investor Relations (IR), explains in an interview with Börsen-Zeitung. The Treasury area, including IR, is set to shrink from 150 to about 120 employees by 2026.

The fact that the IR team has been given an additional area of responsibility, and will in future be responsible for the group's annual general meetings instead of the Finance Communications only has an optical effect. Five employees have transitioned to the IR area. Woller emphasises the rationale behind the shift, saying that "Annual General Meetings, with the exchange between management and shareholders, are a core part of IR work.“ He believes his IR team, consisting of six spokespersons, is „well positioned“ compared to other Dax companies.

The challenging situation for the automotive industry, and for VW amidst technological change, also has consequences for the 51-year-old. He relinquished his position as a member of the board, and Vice President, of the German Investor Relations Association (DIRK) at this year's members' meeting in Frankfurt and Seeheim-Jugenheim.

„I decided not to run for re-election to the DIRK board because I believe in doing things either fully or not at all.", he says. The responsibilities in the Treasury and IR areas at Volkswagen currently leave little time to fully commit to a board mandate like the one at DIRK. „I'm reaching my capacity limits.“

Woller, who was born in Mainz, has held his position in Wolfsburg since December 2021. At that time, Volkswagen combined the Treasury and IR areas with the goal of strengthening bank and capital market relationships through centralised management. In his previous role at Traton, Woller was already responsible for both areas. The Treasury department at VW's commercial vehicle holding had to be rebuilt following its IPO in June 2019. „The then-Traton CEO Andreas Rentschler, CFO Christian Schulz, and I quickly agreed to consolidate the leadership of IR and Treasury whenever the opportunity arose.“

The consolidation makes sense because it ensures consistent information and messaging across different market participants, such as equity and bond investors, analysts, banks, and rating agencies, explains Woller, who worked in various IR roles at the automotive supplier Continental from 2007 to 2018. At banks and research firms, Volkswagen is covered by around 40 sell-side analysts focused on the automotive sector, along with equivalent buy-side analysts on the investor side. Additionally, the automaker is in contact with an average of at least 75 investor groups, more than 40 banks involved in the syndicated credit lines of the Dax company, and about 80 banks worldwide. Woller adds that regular discussions are also held with the three major credit rating agencies, and sustainability rating agencies.

Regarding the current situation, Woller states that it is unusual for VW to announce three changes in outlook within a fiscal year, and to need to keep investors and analysts constantly engaged. In challenging times, there is a tendency to hold off on communicating with the capital markets until there is something more positive to announce, but he states that "my principle is that bad news doesn't get better by not being communicated.“

IR requires continuous, timely communication. „Investors should be able to trust that the actions taken by the company are well-founded and meaningful.“ In the last six months, there have been more investor contacts than in a long time.

„Especially in tougher times, communication with key stakeholders is essential“, emphasises Woller. He expresses some optimism, saying that "the good thing is, we know what needs to be done.“

At the same time, Woller knows that to provide useful information to market participants, it is necessary to discuss uncomfortable questions with management. „Corporate opinions are not always investors' opinions.“

Regarding the scope of tasks in the IR area, which has evolved over the past year, he notes that it used to be „simplistically speaking“ enough to tell just the equity story, regardless of its quality. Today, IR work, which also involves advising management on the company's positioning in the capital markets, is much more strategic. „As a large publicly listed automotive manufacturer, we need to advocate more for the understanding that effects from strategic shifts, major model projects, changes in product lines, or large investments in software architectures may only become visible in financial figures or dividends after several years“, explains Woller.

The investment horizons of investors have shortened from three to five years to now 12 to 18 months. At the same time, new information from companies is responded to much more quickly due to technological advancements. „Trading bots, for instance, react immediately to any published news, causing price fluctuations.“ These fluctuations, Woller notes, can sometimes amount to up to 10% within a single day, leading to the loss of a billion-dollar value in the stock market. Since the end of last year, Volkswagen's market capitalisation has decreased by nearly one-fifth.