VW’s Chief Financial Officer, Frank Witter, called on the European Central Bank (ECB) to accelerate purchases of short-term debt, the Financial Times reported on Friday.
He said the ECB should send “clear signals” and purchase the short-term debt, which often matures in as little as six or nine months, “as soon as possible.”
The ECB said last week it would prop up markets, including through the purchase of commercial paper, as part of a 750 billion euro plan to boost asset purchases to contain the financial fallout from coronavirus.
It remains unclear whether the ECB has started buying commercial paper. VW is one of Europe’s most regular corporate issuers of commercial paper.
“There’s a lot of pressure on the incoming money flow,” said Witter. “We have different diversified funding sources available but not all of them are as liquid as they were.”
VW has the capacity to issue up to 15 billon euros ($16.5 billion) of commercial paper under its main funding program, with another 5 billion euros earmarked for short-term debt in Belgium.
The company’s ringfenced financial services division has a separate commercial paper program with a 2.5 billion euro limit.
Witter said Volkswagen, which has yet to tap bank credit lines worth in excess of 20 billion euros, considered those facilities only as a back-up for when capital markets are shut.
In a separate interview with German paper Boersen–Zeitung, Witter said VW did not see the need to tap state aid to weather the crisis.
Passenger car sales were down 40 percent in March, Witter told the newspaper, adding that the company was reviewing whether its annual meeting could take place on May 7.
For now, Volkswagen is sticking to its forecast of paying a dividend but it was looking closely at all investment and spending needs, Witter told Boersen–Zeitung.
A VW spokesman confirmed the remarks made to the papers.
