Christine Ritz - Head, Group Investor Relations Hans Dieter Pötsch - Chief Financial Officer, Head of Controlling & Accounting and Member of Management Board Christian Klingler - Member of Management Board and Member of the Group Board of Management for Sales & Marketing

Michael John Tyndall - Barclays Capital, Research Division Horst Schneider - HSBC, Research Division Jose M. Asumendi - JP Morgan Chase & Co, Research Division Stephen Reitman - Societe Generale Cross Asset Research Jochen Gehrke - Deutsche Bank AG, Research Division Daniel Schwarz - Commerzbank AG, Research Division Fraser Hill - BofA Merrill Lynch, Research Division Charles Winston - Redburn Partners LLP, Research Division Philip Watkins - Citigroup Inc, Research Division Adam Hull - Berenberg, Research Division Jürgen Pieper - Metzler Equities, Research Division Christian Breitsprecher - Macquarie Research Frank Biller - Landesbank Baden-Wurttemberg, Research Division

Good day, ladies and gentlemen, and welcome to Volkswagen AG Interim Report January to September 2013 Live Audio Webcast and Conference Call. For your information, today's conference is being recorded. At this time, I'd like to turn the conference over to Christine Ritz, Head of Group Investor Relations for Volkswagen AG. Please go ahead.

Ladies and gentlemen, welcome to Volkswagen's conference call on the results for the period January to September 2013, based on the interim report we published this morning. Joining me on today's conference call are Hans Dieter Pötsch, member of the Board of Management, Volkswagen AG, responsible for finance and controlling; and a member of the Board of Management, Volkswagen AG, responsible for group sales and marketing, Christian Klingler. As usual, the webcast can be viewed via our website at www.volkswagenag.com/ir, where you will also find the charts available to download. After the presentations, we will take questions, first from analysts and later from journalists. Let me now pass you over to Mr. Pötsch. Hans Dieter Pötsch: Yes. Thank you, and a warm welcome from my side to those of you joining this call today. Strong sales in China and the deliveries of new models rolled out under MQB drove deliveries of vehicles from the Volkswagen Group above 7 million units for the first time at the 9-month stage to 7.2 million units, a plus of 4.8%. Sales revenue at EUR 145.7 billion was up 1%, impacted not only by the tough European market but also by foreign exchange-related effects. Excluding currency impact, revenue would have been up 3%. And of course, when comparing to the development in deliveries, you should also take into account that sales from our Chinese activities are mainly reported through our joint ventures. Operating profit came in at EUR 8.6 billion, slightly below 2012, impacted by the market environment, as well as contingency reserves. Stronger earnings from the equity-accounted investments in China drove profit before tax to EUR 9.4 billion. This is substantially below the earnings in the prior year period, which were, however, heavily influenced by EUR 12.3 billion from the revaluation of our holding in Porsche and related options. Automotive liquidity increased to EUR 16.6 billion, reflecting strong underlying cash flow and successful placement of mandatory convertible notes, as well as a hybrid bond, providing a strong foundation for future growth. Let me now pass you over to Mr. Klingler to take you through the sales performance.

Ladies and gentlemen, let me first also welcome you to our conference call. I'm pleased to present our key sales figures to you. On this chart, you can see the development of the world car market, as well as the group deliveries to customers in comparison to the same period last year. While the total car market grew by 4.1% in the first 9 months of this year, the development varied considerably by region. The total car market worldwide remains challenging. In particular, the difficult economic conditions in Europe continue to negatively affect car demand. In the context of high unemployment in Southern Europe and economic uncertainty, customers are still hesitant before making a large purchase. But also outside Europe, especially in South America, total markets remain volatile, characterized by an increasingly competitive environment and trading restrictions. From January to September, the Volkswagen Group increased deliveries by 4.8% and grew faster than the total market. This view shows the performance of the Volkswagen Group in direct comparison to the regions around the world during the first 9 months of the current business year. On a global level, as mentioned before, the Volkswagen Group outperformed the overall market again. Sales of the Volkswagen Group increased by 4.8%, while the total car market grew by 4.1%. In South America, Volkswagen Group sales declined compared to last year due to developments in the region's largest market, Brazil. Here, the total market, which declined slightly, was influenced by fading consumer confidence and the recent rising trend of the interest rate. In addition, Volkswagen Group was affected by product life-cycle effects and increased competition. New, locally-produced models have created a more challenging market environment for the Volkswagen Group. Our key model, however, the Volkswagen Gol, remains the best-selling car in the country for 26 years in a row and keeps its year-to-date leadership. As part of our upcoming new model launches, we also introduced one of the most expected cars in the market, the Golf VII, and just announced that we're investing in our factory in [indiscernible] to locally produce this model. We are confident that with these measures, we will defend our strong market position. Although many markets in Western Europe are still reporting a significantly lower level this year, they have begun to see signs of stabilization in France, Spain and Italy. The U.K. has shown a positive development throughout the year. Our deliveries to customers in Western Europe declined by 2.5%, while the total market decreased by 4% in comparison to last year. Nevertheless, the situation remains tense. Therefore, we will monitor this region on an ongoing basis and react quickly to changes with appropriate measures. The Central and Eastern European car market was down by nearly 5%, but our deliveries declined by only 2% compared to last year. Economic uncertainties, a cheaper ruble and high interest rates on loans have led to considerably weaker development in Russia. Total car market growth in the first 9 months of this year was driven especially by the positive development in North America and Asia-Pacific. In both regions, the Volkswagen Group outperformed the total market. Strong consumer confidence in the United States, as well as strong demand in China, especially from small, less-developed markets, provided a good environment for sales growth. This chart shows the performance of each brand of the Volkswagen Group in the passenger car market in the first 9 months of 2013. Nearly all of our brands achieved an increase in terms of deliveries, and for the group, total deliveries to customers, including commercial vehicles, exceeded last year's level by 4.8%. Volkswagen Passenger Cars delivered 3.6% more cars than last year, up to just over 4.3 million units, driven by strong demand in China, Great Britain and Mexico. One of the growth drivers was our new Golf hatchback, which has been very well received by the market and will be launched in the upcoming month in further countries worldwide. Audi deliveries were up by 7.6% to almost 1.7 million cars in total in the first 9 months of 2013. This is particularly the result of the positive course of business in China, Great Britain and United States. SKODA deliveries were down by 4.5% to 685,000 cars. This decline can be attributed mainly to the overall difficult economic situation in Central and Eastern Europe, as well as the ongoing changeover of its volume models in several regions. SEAT increased its sales by nearly 12%, up to 266,000 cars, supported by a strong and good performance in its European home markets like Spain, as well as Germany and Great Britain. Porsche expanded deliveries up to 120,000 cars since the beginning of the year. And Bentley deliveries rose by 9.2% compared to last year to 7,000 cars on the success in Germany, Great Britain and especially, in the United States. Now let me come to the situation of the Commercial Vehicles brands of the Volkswagen Group. Volkswagen Commercial Vehicles were almost on the same level as last year, despite the effects of the European financial crisis on the light commercial vehicle business, particularly with regard to Germany. However, the negative impact on sales in Europe was offset by strong growth in Brazil, Argentina, Great Britain and Australia. In terms of trucks, the total market above 6 tonnes decreased by 0.4% as a result of the economic situation in Europe and in regions such as India and Russia. Brazil, Africa, particularly China, are the only markets still enjoying significant growth. The total bus market decreased slightly compared to the same period in 2012. In view of this difficult economic situation applying to the truck market, MAN deliveries reached 98,000 units, 3.4% below last year. Despite that, the truck sales of MAN made a noticeable improvement, especially in Brazil and Argentina in the last few months. Moreover, the bus businesses of MAN continues to grow, primarily by rising sales in South America and Europe. In the first 9 months of the year, Scania was able to significantly increase sales by almost 20%. Especially in Brazil, Scania outperformed the heavy-duty subsegment development and significantly increased sales. Despite negative market trends, Scania was able to also increase sales in many European markets, including Russia. Underlying sales in Power Engineering, where we are represented by MAN, declined by 9.7% and reached just below EUR 2.8 billion. Now let's take a look at a few upcoming models and highlights, which we will provide on a strong basis for our sales performance in the coming months. In November this year, we will launch our first pure electric vehicle, the Volkswagen e-up!. The e-up! is an affordable electrical vehicle suitable for everyday life and convinces with an outstandingly efficient energy consumption. The innovative and reliable small car, which received its premiere at the Frankfurt International Motor Show in September, provides access to electric mobility for the masses due to its full series production. Following the successful introduction of the A3 family, the Audi A3 Sedan will surely attract the attention in the premier compact segment. This model impresses with sporty, innovative design, powerful and efficient engines, as well as sophisticated technologies, like the high-end infotainment system and driver assistance systems. The A3 Sedan had its world premiere at the Shanghai Auto Show in April and was introduced in the market in September. The Rapid Spaceback is the first hatchback model of SKODA in the compact segment. Besides its dynamic, fresh design and its SKODA-typical interior space, this model impresses with numerous Simply Clever ideas, top safety, interesting individualization options, low fuel consumptions and excellent value for money. The available interior space of the Rapid Spaceback, in particular, sets a new benchmark in this segment. The ŠKODA Rapid Spaceback was presented at the IAA Motor Show last month and hit the street of Europe this month. Last but not least, the SEAT Leon ST, which moves SEAT into an entirely new segment. This new estate model combines stunning good looks with versatility and boot capacity, designed for maximum control, flexibility and precision. Also shown at the Frankfurt Motor Show, the new SEAT Leon ST will be introduced in the market by the end of November.

Thank you, Mr. Klingler. Now let's turn back to Mr. Pötsch for a look at our financial performance in more detail. Mr. Pötsch? Hans Dieter Pötsch: Yes, of course. Let's, as usual, start at a high level. For the first 9 months, the Automotive Division reported flat revenue at EUR 129.2 billion, which would have been 2% higher but for currency effects. Operating profit for the division was down 6.8% at EUR 7.2 billion. The full consolidation of Porsche since the start of the year versus just 2 months in the comparable 9-month period, plus the impact of new models, was not enough to offset weaker mix, the building of contingency reserves and exchange rate effects. The bulk of the 2013, its equity results reflect the performance of our Chinese joint ventures, which continue to perform very positively, recording a proportionate operating profit of EUR 3.5 billion, up 26%, which shows up here post-tax. Financial result in 2012 was positively impacted by EUR 12.3 billion from both the revaluation of our holding in Porsche and the related options. The provision for the minimum statutory interest rate in connection with the Spruchverfahren, which translates as the German award proceedings act, related to the control and profit and loss transfer agreement with MAN SE, was booked in Q3 for around EUR 500 million. The provision is based on an estimated 7-year time frame for the proceedings to conclude, and is booked within the other financial result. Turning to the group operating result performance for the first 9 months in more detail. Volume, mix and price contributed a negative EUR 0.4 billion. The full consolidation of Porsche, which is included in full in disposition[ph] , partially offset weakness in sales outside of China, as well as both product and country mix, in addition to the building of contingency reserves. Our prudent hedging policy broadly offsets the headwinds of foreign exchange, leaving a negative of just EUR 0.3 billion. Product cost savings recorded a positive EUR 1.1 billion. Fixed costs were up EUR 0.8 billion. Our localization of production in key growth markets was the key driver, alongside higher depreciation. Earnings in our Commercial Vehicles, Power Engineering division were down just over EUR 100 million at EUR 390 million. Besides difficult market conditions, this reflects a contingency reserve established by MAN in the first half. The Financial Services Division, including all of our financial service activities, lifted operating earnings by EUR 200 million. In total, operating profit came in at EUR 8.6 billion. Let's now take a closer look at the financial performance of our main brands. The Volkswagen Passenger Car brands reported an operating result of EUR 2.1 billion for the first 9 months, reflecting lower sales volume and weaker mix, as well as costs for new technologies and adverse foreign exchange rates. Earnings at SKODA were down due to costs related to important model startups, the tough European market conditions, mix, as well as negative exchange rates, too. SEAT's earnings were flat. Audi achieved robust earnings of EUR 3.7 billion, posting an above-10% margin for the first 9 months, despite weaker exchange rate conditions, the tougher market, as well as costs relating both to new technologies and the expansion of its production footprint. Porsche continued to power ahead with an operating result of EUR 1.9 billion and a margin of over 18%. Bentley continued to make good progress with a margin of 9.2%. Our focus on premium brands was evident, as over half of our operating result was derived from the sector. With difficult market conditions and also facing a challenging foreign exchange rate, Scania reported robust earnings at the prior year level, while MAN posted a small profit, after the inclusion of product-related provisions. Our light commercial vehicles brand was able to grow earnings slightly. Over the first 9 months, Volkswagen Financial Services booked 3.1 million new contracts, an increase of 11.2%, growing earnings by EUR 139 million out of a total plus of EUR 227 million for the Financial Services Division, highlighting the importance of Financial Services to the Automotive arm of our business. Now turning to cash flow in the Automotive Division. Operating cash flow increased from EUR 11.9 billion to EUR 14.7 billion. This demonstrates the robustness of our business model, whereby we were able to generate solid cash flow even in a challenging environment. Working capital improved by EUR 141 million. Our CapEx ratio for the first 9 months of 5% is slightly up year-on-year. To the further right[ph] , in line for the fourth quarter, which follows the usual seasonality pattern. The trend is within our guidance of between 6% and 7% for the full year. EUR 2.6 billion or 30% of all R&D spent was capitalized, reflecting the higher ratio of the newly consolidated MAN and Porsche brands, as well as the expansion of our product portfolio. Net cash flow came in at a strong EUR 6.1 billion before considering equity investments, which include the transfer of the 50% share in LeasePlan to the Automotive Division in the first quarter of this year. At the end of September, net liquidity stood at EUR 16.6 billion in the Automotive Division. Liquidity was strengthened by the successful placement of a mandatory convertible note in June to the value of EUR 1.2 billion, of which EUR 1.1 billion is booked within net liquidity, and the hybrid bond of EUR 2 billion issued in August. And so to conclude my presentation today, let me now turn to our outlook statement, which is detailed in full in our interim report. We are forecasting that growth in the global market for passenger cars is likely to be weaker in full year 2013 than in 2012, and that the overall volume in the markets for light commercial vehicles, trucks and buses that are relevant for the Volkswagen Group will remain at the same level as in 2012. This shows that our focus on costs, implementation of our strategies to drive further process improvements, and the prioritization of investments are the right answers to ensure our competitive position continues to improve. In particular, we do not expect an improvement of the economic framework conditions in the short term. In 2013, we expect that the Volkswagen Group will outperform the market as a whole in this challenging environment, and that deliveries to customers will increase year-on-year. We expect the Volkswagen Group's sales revenue to exceed the prior year figure. Given the ongoing uncertainty in the economic environment, the group's goal for operating profit is to match the prior year level in 2013.

Mr. Pötsch, thank you very much. We will now take questions from analysts. [Operator Instructions]

[Operator Instructions] We'll take the first question from Michael Tyndall from Barclays. Michael John Tyndall - Barclays Capital, Research Division: Two, if I may. The first one, Mr. Pötsch, I wonder if you could talk a little bit about the cost environment when we look out towards Euro 6, 130 grams in Europe. I mean, it seems to me that you've got these consistent headwinds coming towards you. And I wonder to what degree. And I guess without saying it, the stories that have been in the press, this is already factored into your planning, and essentially, the targets that you've given us for margins for 2018 already encompass those rising costs. That's the first question. The second question, if I think about 2014, you currently have a guidance that says it will exceed -- your EBIT will exceed 2013. If I'm not wrong, your view on Europe is quite pessimistic in terms of volumes to be flat to down. Brazil looks a bit shaky. U.S. doesn't necessarily look great. Is it possible for you to achieve that result without any volume growth next year, or am I getting it wrong?

Okay. Thank you, Mike. You have 2 questions for us. So first question is related to headwinds coming from Euro 6 requirements and if those requirements are actually already involved in our internal planning and in our goals we have released for the brands and for the group towards 2018. And the second question relates to the year 2014, if we can give a little bit more color about the situation we do expect for '14 and if we can give a bit more detail what we will expect also with regards to volume development, but also with regard to earnings development. Hans Dieter Pötsch: So to the first question on possible effects coming out of necessary upfront investments, R&D costs and later on, also unit cost effects with regard to EU 6 and other regulatory targets to be met towards 2020, and whether this is already factored into our plans. Now fundamentally speaking, I think it should be evidently clear that to be able to meet the targets, for example, of the EU 6 introduction until 2015, always necessary on the truck side with regards to EU 6 to be introduced next year at the latest, and the extremely demanding 95-gram CO2 target for 2020 for the fleet, where the group firmly committed to meet the target, it is very clear that we have been working on these issues for quite a number of years, otherwise it would be completely impossible to get there. So this is to say that, of course, the last 3 years already, the results were kind of burdened with the upfront investments, specifically on the R&D side. In order to get there, a lot of testing, which is necessary. And of course, in our rolling planning exercise, which normally runs for a 5-years period, the necessary costs in all the various circumstances are completely factored in. Now whether this is enough, what we have in our plans, is something which needs to be proven. From today's point of view, I think we are pretty much okay. So I would, in the simple way, say the commitment we entered into with regard to our targets 2018, specifically our pretax return target of 8%, that includes the necessary investments, costs on whatsoever, also with regard to all the regulatory framework conditions. Of course, there is one comment I need to make at this point. We can only judge the circumstances as we know about them. You certainly know that discussions continue on in a number of countries, so if there is anything more stringent coming along, that might need another assessment. But we know, from today's point of view, we are okay in this regard. And then on 2014, yes, of course, we quite -- I may say, traditionally, we take a more cautious view on the economical framework. And indeed, we believe there is not so much to build a real optimistic outlook for a number of the results[ph] in Europe for next year. But we stick to what we formulated in our annual report, which means that the EBIT in 2014 is targeted to be higher than the one we turned up within 2012.

Next question comes from Horst Schneider from HSBC. Horst Schneider - HSBC, Research Division: I'll try to keep it as brief as possible, but I have got 3 questions. The first one refers to your earnings walk-down that you show in the presentation. And I think for the third quarter, you show a positive volume/mix/price effect in the magnitude of EUR 100 million. And I want to know if that also implies that pricing was positive in the third quarter. And can you confirm that -- what other carmakers have reported, that the price trend in Europe is improving now on a year-on-year basis and also on a sequential basis? Then I want to get more details or I want to understand how I should think about the fourth quarter. I mean, you're aiming for EUR 11.5 billion EBIT. I want to know if there is really a cap for 2013 in terms of EBIT that you can achieve, or can we assume that you maybe even can slightly exceed that target? And in that context also, I mean, your CapEx-to-sales guidance of 6% implies that you should show EUR 4 billion CapEx in the fourth quarter. So should we assume then a negative free cash flow for the fourth quarter? And then the last question, and that is, for me, the most important, is on MQB. I'm losing a little bit overview on the potential net savings that we can expect from the platform, especially having in mind that we have seen some nasty press articles in the last few weeks. So I want to know how should we think about the trade-off between lower purchasing costs and rising depreciation and ongoing ramp-up costs, especially for 2014.

Okay. Thank you, Horst. You have 3 questions for us. First of all, you would like to have some color on our EBIT walk-down, earnings walk-down, especially with regard to the third quarter if -- and regard pricing -- volume-price mix. Was pricing positive in Q3 is your question. And do we see any improvement in the European markets with regard to pricing? Then your second question is related to the fourth quarter. What is our assumption for the fourth quarter, or can we give you some more color how the fourth quarter -- should we expect and probably even exceed our 2012 earnings level. And with regard to CapEx-to-sales ratio, you are interested in the development in the fourth quarter. What does that mean, actually, for our cash flow development. Do we have to expect a negative free cash flow in the fourth quarter? And your last question is related to MQB, and you are interested in a little bit more information. What do we expect, especially for next year, on a net basis, really, which effects can we see next year coming from MQB.

So maybe allow me to start a little bit about the pricing and pricing environment. We do not see any major changes in terms of pricing environment, so we do not have the feeling that the pricing environment in general has become better. If you go into the regions, Europe is and was competitive. This has not changed from our perspective. By the way, none of our segment, not in the passenger cars, not in the premium segment, as well not in the truck segment, so this is predominantly[ph] on the same level as it was over the last quarter. So very tense, very competitive. We expect -- unless the market is not improving in terms of total volume in a significant manner, it would be surprising if the pricing environment would come much better than it was over the last quarters. If you go to other regions, we see, certainly, some pricing effects in one or another region, like, for example, North America, where we have some of this, so some increased negative pricing effects. We see, as well, some tendencies in South America, where the pricing has come, as well, very competitive. And we see, as well, as some intensification in Russia, for example. China stays more or less to a same level as the last quarters. So in general, we have the feeling that in Europe, pricing is as it was, very competitive, and we believe it will stay unless the markets are not improving in terms of numbers. There are some regions where we see an intensification of pricing competition, and we see, as well, that in some other regions there may be a stabilization. But we have not seen an improvement in that perspective. Horst Schneider - HSBC, Research Division: So pricing was negative in the third quarter year-on-year?

The pricing was on the same level as it was the quarter before. Horst Schneider - HSBC, Research Division: So Q2 '13?

Exactly. [indiscernible] since the beginning of the year. Hans Dieter Pötsch: Okay. I can continue on with the question with regards to the fourth quarter, respectively, the full year. Quite honestly speaking, I think we have a clear guidance in the market, which says we will match the prior year level, and that's what we do. And I think there's nothing more to speculate about. It is what we will deliver. Second point, CapEx-to-sales, it is evidently clear, and we said this also very clearly before, we'll end up in an area between 6% and 7% in terms of CapEx-to-sales, which clearly says -- and this is only a confirmation of the usual seasonality pattern. We will see a significant CapEx number coming along in the fourth quarter then. And then it always depends on whether certain items can be approved, which means they will be booked to the balance sheet in 2013, or whether it's getting shifted into 2014. And that will have, of course, some impact on the cash flow side. What I can say at this point, we definitely will end up with a good net liquidity number also at year end. And then on MQB, and I better do not comment on completely unreasoned things which were passed through the press on whatever basis. We clearly stated that we think there is no reason for these arguments. The company completely sticks to the commitments which we gave, which means we do already enjoy significant contributions from the MQB side in 2013. Otherwise, it would not be possible to tackle, for example, issues like exchange rate fluctuations, market difficulties and the like. And it should be very clear, and we gave the volume numbers which we expect for 2013 and 2014. It is clear that any substantial investment is related with significant one-off expenditures, which leads to significant depreciation in the years coming. It's one of the effects you can read in our fixed-cost development, '13 against '12. And this, in other words, means we need the volume to be produced to justify the upfront investment. And with a number of 1.4 million, 1.5 million cars sitting on the MQB platform coming along in 2014 -- this is the number with the exception of China. Including China, it's going to be roughly 2 million cars in 2014. We'll see the first signs in a more visible way of MQB effects. Saying this, I'm saying I do hope that the negative effects, which we had to digest in the last months, for example, coming in from the emerging markets, from exchange rates and the like, will kind of level out and not be more substantial as what we can judge from today's point of view.

We'll now take the next question from Jose Asumendi from JPMorgan. Jose M. Asumendi - JP Morgan Chase & Co, Research Division: Two items, please. The first one, on currency hedging. As you're finishing your budget planning, how should we think about a conservative currency headwind to build into a forecast next year? And second item, I just want to come back to the Frankfurt presentation, what you outlined, the improvement of the Volkswagen brand margin from 3% to 6%. Within this re-rating, Mr. Pötsch, could you please remind us what are the biggest buckets behind that in terms of volume, pricing improvement or cost savings? How should we think about them? And I was also wondering if you are assuming a recovery of the European car market returning to all-time highs.

Okay. Thank you, Jose, for your 2 questions. So the first question is referring to currency headwinds of the development we do expect next year, if we can give you some more information if we expect currency headwinds also next year. And the second question refers to the 2018 target for the Volkswagen Passenger Car brand of 6% EBIT margin. What do we see, what are the drivers to achieve this target, what is necessary to achieve that goal. And then the third question, more or less, is then if we do expect a recovery of the European market soon or does it take very long. Hans Dieter Pötsch: First of all, with regards to the currency headwind which we have to expect for 2014, as you're well aware, we are heavily hedged into the key currencies. Nevertheless, in a number of areas, it's either not possible or too expensive to work on a higher level of hedges. So ultimately, I would say it should remain in the 3-digit area, but expect to be somewhat higher than what we did see in 2013. Second question, to improve the margin on the Volkswagen Passenger Car side means primarily an improvement of the economical framework conditions. So this is to say that we need stabilization in the emerging market situation, where, for example, in countries like India, even Russia and, in a limited way, Brazil, we have a pretty volatile situation currently. We did install the main drivers for improving the profitability already, with a major step in terms of the MQB introduction. We do see that the success of the first cars introduced on the platform is already contributing, so I think that's an excellent basis moving forward in terms of introducing additional cars. But the essential point here is, indeed, the improvement of the economical framework, which should lead to somewhat higher volume in a number of markets. That's the main driver which we see in terms of moving the margin on the Volkswagen Passenger side into the right direction.

Next question comes from Stephen Reitman from Societe General. Stephen Reitman - Societe Generale Cross Asset Research: First of all, on the impact of the storm that hit the Wolfsburg area, could you give us some feeling for what impact that had on the third quarter in terms of delivery to the dealers versus sell-through to follow customers and how that gets made up in the fourth quarter? And again, returning to the issue of MQB and the press speculation, it's been quite recent. I understand your comments, but just to give you -- I mean, just again, a confirmation that you refute completely some of the figures that have been coming out, at least, which were basically suggesting that some of the projected margins on future generations of vehicles which will be on the MQB platform might have lower margins than existing products.

Okay. Thank you very much, Stephen. You have 2 questions for us. The first question refers to the Volkswagen Passenger Car brand and if we can give some details on the impact of the hailstorm, the storm here in Wolfsburg we had, and what does it mean -- or did that have any impact in deliveries and how actually will we distribute the cars to the customers or what does it mean probably for the fourth quarter. And the second question refers to the MQB, if we can give you some more information about margin development of the cars which are based in the future on the MQB, because there were some press speculations that we do have -- expect lower margins.

Maybe I'll start with the hailstorm, which has effectively come down or came down here in Wolfsburg. The damage was something like 17,000 cars. So the whole process, of course, is perfectly organized, and I would guess that over the next few weeks, all cars which could have been repaired are and will be repaired, and then comes to the deliveries. So as a consequence, of course, in the first -- in the third quarter, sorry, a big bunch of these cars have not been delivered, and the deliveries will come then in the last quarter. So it's nothing which is impacting the total year on a strong impact. But it shows that -- it explains why in September, in particular, in Germany, the cars haven't been there to delivery to the customers as was forecasted. And now it will be over the next few weeks and up to the last weeks of December. Hans Dieter Pötsch: Then again, on the question of margins of future cars and the related articles in the one and the other magazine, to cut a long story short, the cars which we'll bring to the market, under the condition that the predecessor model has a sufficient margin, will at least meet the margin requirements of the predecessor car. And then I think we should finish up with this issue, because we're talking partially cars, which will turn up in the market only a couple of years from now, and then it should be very clear that there might be work, but it will lead to a very acceptable target. Stephen Reitman - Societe Generale Cross Asset Research: Can you just also maybe give some guidance as well? You mentioned the 1.4 million, 1.5 million units on MQB in 2014, excluding China. Would you be prepared to give us a figure for where you think you will be in 2015, as you need a certain volume, let's just say, to cover the upfront costs of MQB? Hans Dieter Pötsch: The respective number for 2015 is somewhere in excess of 2.7 million. That's including China, of course. So it talks with the 2 million in 2014. Stephen Reitman - Societe Generale Cross Asset Research: And the growth will be more in non-China, I would suspect? Hans Dieter Pötsch: One second, please. Except China, it's roughly 2 million.

Next question comes from Jochen Gehrke from Deutsche Bank. Jochen Gehrke - Deutsche Bank AG, Research Division: Just a question on VW brand performance. Within the quarter, you obviously saw a very sharp drop in revenues, yet your operating profit actually improved. Now when we look at mix, that was probably a negative. ForEx had some impact on VW brand, I assume, as well. What was the biggest offset? Was it the startup costs of MQB coming down, or was it actually contribution margins growing? Basically, what am I missing in that? Because it looks like it's a couple hundred million euros. And then secondly, on your walk, where you're presenting the product cost. Within the quarter, product costs have fallen by about EUR 500 million, which, at least against your own history, is one of the highest numbers. Is this now an outlier? Or if modeling the walk, is that EUR 500 million number roughly what we should be thinking about when going for the coming years, given that the MQB effect, as you just confirmed, are suggested to ramp up?

Okay. Thank you, Jochen. You have 2 questions for us. The first question refers to the Volkswagen brand, as you do assume that mix/currency/volume metric on the development of the Volkswagen Passenger Car brand in the third quarter. So you want to know what are the biggest offset, what was actually the positive contribution to the development of the brand. And second question refers to our product cost achievements in the third quarter and what does that mean, actually, for the full year. Or especially, you're interested in the guidance for next year, what should we expect in savings from product costs. Hans Dieter Pötsch: Okay. I think a very clear and quick answer. First of all, as I already said, the big contributor is the introduction of MQB cars, which do offer an excellent contribution margin. And we are currently, as far as the third quarter is concerned, we have now a bit more than 700,000 cars in the market. That, for these cars, means stabilizing prices, good cost basis, so that's a big contributor. And in a similar way, you can read this also in the swing factor of the product cost development, which was very positive in the third quarter. And there is definitely something more to come in terms of -- and could be cost effects. For 2014, anyway, we're targeting another improvement of more than EUR 1 billion.

Next question comes from Daniel Schwarz from Commerzbank. Daniel Schwarz - Commerzbank AG, Research Division: I have 2 questions. One is on your view on the development of the competitive landscape. In case the large European OEM ties up with the Chinese competitor, would that be a bigger concern for you? And the second question is with your net cash position having increased so substantially, does that -- or is that the basis for a step-up in the dividend payout ratio in 2014? And maybe in that context, you could remind us the minimum net cash position that you want to have. That is still around EUR 10 billion. Is that right?

Okay. Thank you, Daniel. You have 2 questions for us. The first question is a question about the competitive landscape, and you want to know what we think if our competitor would have a kind of corporation or combination with the Chinese OEM. And the second question is referring to our net cash flow development, the positive development we have seen in the first 9 months, and if we can give a guidance with regard to our dividend we do expect then for 2013. And actually, what -- also, you are interested in an update in our minimum requirement with regard to net liquidity, if we can give you a number or confirm what we said before. Thank you.

If you allow me to start a little bit about the competitive environment, knowing that we always try to not to go into any detailed conversations about the others, we believe we have enough things to do at our own side. But if you go to environment, and the competitive environment is pretty clear that, in general, we see more in concentration than a non-concentration effect. This is -- which has happened over the last years, and this will continue, particularly, by the way, in China. There's still a lot of manufacturers out there, and there is some tendencies that these numbers, which are largely more than 25, will be reduced over the next years to come to a much more decent number. If you come to Europe, we should not forget that the market environment in Europe, in general, compared to 2007, has given a reduction of total market, largely, over 4 million cars in the passenger cars side. So this is very strong, and of course, the pressure on everybody in this market has increased as a consequence. Do have partnerships some impact? Some have, some don't. So we don't know exactly how the others work and how it works for them. We believe in the end of the day, what counts, that we bring the perfect car with the perfect offer, with the perfect package in terms of everything what they can imagine to the customers, and they are taking us and giving us priority. So we believe that the customer is making the choice and not somebody else. So therefore, we will continue to make everything and to be more than ever focused to do everything that our customers are happy with us and get the right product and the right services at the right level of conditions that they will choose us. I think that is, in general, true, and we believe, as far as in terms of competitive environment, concentration, not in all, but in some of the regions, will continue in terms of investments. So this is what I think what I would like to say to this. Thank you. Hans Dieter Pötsch: Okay. Then I can continue with the dividend, where I would say it's too early to comment on dividend. Very clearly, we are committed, as you're well aware, in the midterm to target level of 30% payout ratio. And then on the net liquidity side, we believe we should have at least EUR 6 billion to EUR 7 billion in terms of net liquidity available. We can say we feel comfortable with EUR 10 billion.

Next question comes from Fraser Hill from Bank of America. Fraser Hill - BofA Merrill Lynch, Research Division: Just a couple of quick ones and clarifications. Apologies if you've gone over these topics. I think you were saying that the EUR 500 million product cost benefit that you saw in Q3 was sort of largely MQB. I know you might have just run through that, but could you confirm that, that is still the case? And also on the fixed cost side as well, that was very good during the quarter. Actually, on the positive side, I think EUR 75 million. So what was helping that line, and how are we going to think about that going forward? Finally, just on the free cash flow and the potential for some of those items to reverse in the fourth quarter, are there any items, in particular, that you would flag to us? I mean, the cash tax is roughly quite low. I guess that comes back a bit in Q4. Is there anything else in addition to that, that we should think about into the fourth quarter on cash?

Okay. Thank you, Fraser. So we have 3 questions from you. The first question refers to our product cost benefits, if we can confirm here that this is partially coming also from the MQB. And the second question is regard to fixed costs, if we can explain what was helping the development in terms of fixed costs. And then you want to have some more color for the fourth quarter in terms of free cash flow, if we can give you some more information or more items. Hans Dieter Pötsch: First of all, on the improvement in -- for our cost, which was pretty substantial, which is not abnormal, I need to say first, in third quarter, because some contracts which we entered before to then materialize. But it's one part. Nevertheless, I can confirm that a good part of the EUR 500 million is related to MQB. Then secondly, on the fixed cost swing, the run rate in the first quarter was EUR 300 million. It came down to EUR 200 million in the third quarter. We know the main contents there is depreciation, one; R&D, two. And here, also, the ramp-up costs, of course, play an important role. And this is the first time that this part of the costs do come down. Now here, I need to give a little warning because, yes, there's a tendency going forward they will become reduced, but as we continue to invest, of course, depreciation will absorb, maybe even somewhat over-absorb this. That's the development on the fixed cost side. And on the free cash flow side, there is nothing, really, which would bounce back in the same stand in the fourth quarter. It needs to be taken in consideration that in the third quarter, we did receive the final part of a Chinese dividend, which, of course, will not come again in the fourth quarter. I did say that, of course, CapEx will be on another level in the fourth quarter, which will hit cash flow generation. But again, taking everything together, we'll end up with a very convincing piece of net liquidity at the end of the year. Fraser Hill - BofA Merrill Lynch, Research Division: Okay. And just on the cash taxes, should we expect cash taxes in Q4 to broadly match the P&L tax charge? Hans Dieter Pötsch: Let's say only in a normal way, nothing exceptionally. What we have seen last year, for example, where we had to finalize on a couple of tax audits, which brought in far over-proportional outflow of cash with regard to taxes. So nothing like this is to be expected in the fourth quarter.

The next question comes from Charles Winston from Redburn Partners. Charles Winston - Redburn Partners LLP, Research Division: Two very quick ones for me, I hope. Just going actually back to one of your very early questions in terms of trying to understand the plus-EUR 100 million impact in the profit walk from price/mix/volume. You were quite clear that it probably wasn't a pricing element, and obviously, volumes were negative, and mix, you've confirmed, was quite tricky. Is the missing piece here the impact of Porsche? In other words, obviously, the Porsche acquisition is showing in that bit of the bridge, and is that the piece that we're all missing? And if it's not Porsche, could you just, perhaps, tell us what it might be? And then just secondly, you talked about the FX impact on revenue at the 9 months being 2%. Can you just give us that figure for the third quarter by itself?

Okay. Thank you, Chuck. You have 2 questions for us. And you're referring to the EBIT bridge and the price/mix/volume effect in the third quarter, if we can give you some more information what are -- were the main drivers, also because this box includes also the earnings contribution from Porsche AG. And then the second question refers to currency impact -- to the currency impact, and you would like to have the number for the third quarter only, so excluding the half-year figures. Hans Dieter Pötsch: So first of all, on the FX impact to third quarter sales revenue is EUR 1.7 billion. And then on the first question, I'm not 100% sure whether I got this right. As we said already, in this 3-factor analysis in the column of price/mix/volume, Porsche is factored in. Charles Winston - Redburn Partners LLP, Research Division: Yes. Sorry to interrupt, but if volume was down, mix, you've been quite cautious about. And your answer to an earlier question was that pricing hadn't really moved. It was pretty flat, if not slightly difficult, and yet the figure was plus EUR 100 million. Is the missing piece between plus EUR 100 million and a whole loot of negative or flat items, is Porsche the missing piece? Just to confirm that. Hans Dieter Pötsch: Mr. Klingler was talking about the pricing situation on a real basis. Of course, we have inflationary price adjustments, which we don't really count but which play a role, of course, if you do the profit walk. That's the missing piece. Charles Winston - Redburn Partners LLP, Research Division: Okay. Forgive me. So it's the difference between, as you say, sort of inflation -- pricing at the revenue level and then achieved pricing at the profit level? Hans Dieter Pötsch: Yes.

The next question comes from Philip Watkins from Citi. Philip Watkins - Citigroup Inc, Research Division: It was really one on uses of cash and just -- I'm referring back to the Frankfurt Motor Show, and there was a presentation from Financial Services. And if I'm not mistaken, I think there was a comment about a need to improve capitalization here a little bit. I was wondering if that would be a use of cash in 2014, or can that be funded by FS itself or through hybrid bonds, for instance?

Okay. Thank you, Philip. You're interested in our FS business and especially, how we will capitalize our FS business next year, if we need there some cash and how we will actually finance that. Will that be through bonds or if we can give you some more information or an update based on the equity requirements. Hans Dieter Pötsch: First of all, thank you for your idea. Definitely, first of all, Financial Services could potentially go on its own. But we need -- first of all, before we talk about this, and we only made the comment in this regard in a pretty early phase, but we, first of all, need to go through the testing with the regulators to see how certain assets are being, risk-wise, assessed. And then once we know this, we know precisely where to go, and then we need to tailor the appropriate measures to be taken. But it could well be that we issue something from the FS side, we could also make use of funds available already. But that's something which is related, of course, also to the magnitude of the necessity and a couple of other things. So we need to be patient on that, but I think it's going to take until some mid-2014 until we will know a little bit more about it.

The next question comes from Adam Hull from Berenberg. Adam Hull - Berenberg, Research Division: Two questions. Basically, on startup costs, just to be clear on, firstly, on the Chinese JVs, I mean, we don't hear that much about them. And I think you've taken some costs, obviously, on Foshan plant and Ningbo, those have just got going. I just wanted to sort of get a feel for what the costs you're taking in Q3 and were they higher than in Q2. Is Q3 the peak in terms of startup costs there? And following on startup costs also on Porsche, just to get a feel for will Q3 be the peak? Is it Q4 on the startup, obviously, of the Leipzig expansion and coming through with the Macan coming into next year? And then finally, second question on CapEx. Maybe you could just give us a little bit of a feel for what you're thinking on CapEx in 2014 is, maybe in absolute terms. Is it flat? Is it slightly up? And maybe if you could give us roughly what you think the PPE number will be in euro terms, that would be great.

Okay. Thank you, Adam, for your 3 questions. So you want to have some more information on the startup costs for new plants, which we are currently planning, especially for China. You mentioned Foshan and Ningbo, if we can quantify that and if we have seen the peak already or if something is coming. And then the same applies for Porsche. You're interested in the startup costs with regard to the Porsche Macan. When do we expect here the pickup in startup costs, when will that be. And your last question refers to our CapEx planning, especially for next year, if we can give you some color and some more information. What we do expect also with regard to PPE in euro terms. Hans Dieter Pötsch: First of all, just to avoid misunderstanding, let me say that if we talk about Chinese manufacturing plants, then, with very few exceptions, we always talk about manufacturing plants of our Chinese joint venture companies. So any effect, of course, produced in these plants, for example, in terms of startup costs, would always be factored into our financial result. It's nothing to do with our operating result. Now back to your question then, of course, ramping up production in new Chinese plants means also ramp-up costs. These did occur already in this year. There will be a good portion also in the fourth quarter this year, and also in the first quarter in 2014. The same holds true for Porsche, where we will start production of the new Macan this year. But clearly, until you ramp up production to the level which means maximum output, it takes a bit of a time. So also, the beginning of next year, clearly, we'll be burdened with ramp-up costs at Porsche. This is also to say that we will, in 2014, not reach the maximum output per annum for Macan. This is to be expected in a year later. And CapEx for 2014, I, first, again, would like to remind you to my several remarks I made in past month, that 2013, 2014 will be 2 years with relatively high investments. That's why, except in brackets, relatively high CapEx-to-sales ratio in the area of 6% to 7%. And as we will end up somewhere in this range in 2013, something similar has to be accepted -- expected in 2014. Adam Hull - Berenberg, Research Division: Can I get just a little bit, maybe, of just a quantification? Your margin, you're saying 17.5% at Porsche in Q3. I'm presuming that's already taken a decent number -- amount of costs for Macan or an option[ph] . And at Foshan -- sorry, the Chinese share of EBIT of 1160[ph] , I know you're already taking quite a significant number of costs in those Q3 numbers. Or is there still more much more of a ramp up to come up in terms of the cost levels? Hans Dieter Pötsch: The peak is still to come. Adam Hull - Berenberg, Research Division: Okay. And absolute 2014 CapEx, I mean, is it flattish or -- this is quite a wide range, 6% to 7% this year and next year. I mean, just to get a feel on the euro number. Hans Dieter Pötsch: Yes, but the point that I already made, that there are a couple of issues where we don't exactly know whether they will be booked in 2013 or whether it's going to be 2014. That's why only once you close the books on 2013 that you have a better visibility on what's going to happen in 2014.

The next question comes from Jürgen Pieper from Metzler Equities. Jürgen Pieper - Metzler Equities, Research Division: I have 2 questions on Audi. The first one is, should one expect a tough year in 2014? So in other words, an earnings decline like we see in 2013. It was because the pipeline of Audi holds just the TT for 2014, if I see it correctly, if we talk about new cars and not face-lift cars. And the second one, also on Audi, is the impression right that Audi is taking up incentives just a little in the third quarter to defend the market share, while sort of Mercedes and also BMW coming up with more new models at present than Audi does?

Okay. Thank you, Jürgen. So you have 2 questions on Audi for us. So one question refers especially to the expectations we have for Audi next year, also against the background of the model pipeline we do have and if we can, there, give some color also with regard to the earnings development. And the second question refers to some rumors that Audi -- how Audi was performing in the third quarter, if we do -- or have seen a higher incentive level in Q3 than before.

So maybe I will ask to answer this question. So if you come first to the second quarter in terms of -- to the second question, sorry, in terms of pricing, what you're essentially asking for, Audi is working the environment, as all the other brands, so we don't see any major differences between Audi, Mercedes and BMW in that perspectives, not in the last quarter like we have seen it before. So we're launching very exciting new cars. For example, the new A3 Sedan will play an important role over the next months to come, certainly in Europe, but even much more in other regions like in North America and in China. And it will bring additional color to the Audi brand in that segment. And of course, we are preparing new launches next year, and we have very, very exciting new models in our pipeline. But we're going to talk about order details today, as a good sales guy try to sell what we have today, not what is happening in 12, 18 months. But we are extremely confident that we have a very strong product portfolio. So the Audi brand is performing well. The Audi brand is strong, is increasing in a very positive manner, for example, in the United States, where we come back step by step. Very good as well in China and we're defending our good position we have in Europe. So we believe we have a very good starting point. We have very nice products. We have very good reception coming from the specialists, as well as from our customers. And we believe that we have a lot of right and nice answers to what one or another competitor might have in its own product portfolio. So we have a very strong and positive feeling about the next 12 to 18 months to come, and I think that is basically the question what you wanted to have been answered. Hans Dieter Pötsch: A little on top of this. As you're well aware, we have a range in which we want to see Audi developing, which is 8% to 10% operating profit-to-sales. And there is no reason to believe that Audi -- that we have to deviate from that range.

The next question comes from Christian Breitsprecher from Macquarie. Christian Breitsprecher - Macquarie Research: Most of my questions, actually, have been answered.

The next question comes from Frank Biller from LBBW. Frank Biller - Landesbank Baden-Wurttemberg, Research Division: It's 2 question remaining on my list here. The first one is on Financial Services here, and you have seen a very good performance in the third quarter, up by 1/3, the operating profit. What is your expectation for the next quarter and also for the next couple of years? Or should we assume here a margin decline, or should there be more stabilization of earnings here? And the second question on China. What is the current situation in sales, margins, volumes here in China? We have seen north of EUR 1 billion as an operating income, the share of Volkswagen, so for the whole year, it should be in the range of EUR 4.5 billion. Should we assume here for the next years a declining absolute number, so in the range of roughly EUR 4 billion, or is it still expected to reach that EUR 4.5 billion or even north of that?

Okay. Thank you, Frank. So the first question refers to our Financial Services business, if we can give you some more information, what we expect in the fourth quarter and what is our expectation for next year or the next years even. Does the good performance continue. And the second question refers to China, to our sales development, but also earnings contribution. What is our assumption for the next years or next time. Do we see any -- or do we have to expect any decline or lower performance on China. Hans Dieter Pötsch: First of all, on the Financial Services side, I could only read, I think, good performance without any doubt. And there is no reason to believe that, that should diminish in the next quarters coming along. Now I think what is important is that we also see that the extraordinary low interest rates do, of course, support the effectiveness of the business model to quite an extent. So this is only to say, if you ask me for a number of years going forward, I would be very bullish in terms of continuing with this robust business model in this extremely successful corporation with the Automotive brands. I think that's something very sustainable, and we will roll out the business model into new markets with ever-higher penetration rates. I think that's all running fine. Again, also here, the framework conditions do play a role. On China -- and a few of the colleagues just returned from China. I think with all the talk in terms of cooling down in China, whatever cooling down means, it does appear to us that the framework conditions are in place. The resources available in China will continue to grow also in the Automotive sector, in spite of all the regulatory issues, which, of course, do also pop up in China. And on that basis, of course, we continue to invest. As you certainly know, we'll increase our capacities there year-by-year going forward. And on that basis, I think a continuation -- I'm not proposing to proportionalize everything, but a continuation of the enormous success in China by the Volkswagen Group is on hand.

Okay. Thank you very much. No open questions are left. I will ask the journalists if they have any open issues. If not, we would close the call.

[Operator Instructions] We have a question from Chris Bryant from Financial Times.

Slightly strange question, you may think, but nevertheless, I think this is quite important. It was revealed last week that the U.S. has been monitoring the mobile phone of Angela Merkel for, perhaps, more than 1 decade. My question for you, therefore, is are you concerned about the dangers of corporate espionage via state surveillance agencies? What actions are you taking to ensure that, given you're such a global company, you do not -- yourselves become the target of such surveillance?

Okay. Thank you, Chris, for that very interesting and closing question of the call, I would say. So you are asking about a serious topic because -- what do we think -- or are we, as a company, concerned about corporate espionage. What do we think about that topic? Hans Dieter Pötsch: I think the answer is relatively simple. Yes, of course, we are concerned, and we have been concerned since quite a while. And there are significant measures which have been taken by the company. But as you certainly will accept, it's nothing which somebody wants to talk about.

Okay. Thank you very much. I would like to come to an end and would like to thank you very much for taking part in our conference call. Enjoy the rest of the day. Goodbye from here in Wolfsburg.

Thank you. That will conclude today's conference call. Thank you for your participation, ladies and gentlemen. You may now disconnect.