VW has forward contracts and swaps for aluminum, copper, coal and lead for up to six years ahead, and nickel hedges stretching out nine years, alongside price protection on platinum, palladium and rhodium.
Its largest commodity hedges are in the nickel market, valued at 3 billion euros at the end of last year, according to its annual report.
Nickel, important for making electric-vehicle batteries, has surged 55 percent during the first quarter. The illustrative mark-to-market gain on those hedges would have been about 1.5 billion euros, according to Bloomberg calculations. VW’s aluminum position would have gained about 500 million euros, having been valued at 2.5 billion euros at the start of the year.
The German automaker, which had said in March Russia’s invasion of Ukraine threw its outlook of an 8 to 13 percent boost to 2022 revenues into question, added that it also could be hit by “a worsening COVID-19 pandemic and from the supply situation — especially for semiconductors.”
Workers are locked in Volkswagen Group’s Shanghai factory after production was idled by the city’s strict rules to prevent the spread of COVID-19 virus.
VW Group expects to publish its full first-quarter report on May 4.
Reuters and Bloomberg contributed