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VW Weighs Sale or Spinoff of Units

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The Associated Press
BERLIN -- German automaker Volkswagen AG said Friday it is considering selling or spinning off its Europcar car-rental unit as well as a consulting division.

Volkswagen's supervisory board ordered managers to "review all options, ranging from strategic expansion to an initial public offering or sale" of the two units, the company said.

It didn't say how much it could raise from a sale of Paris-based Europcar, or auto industry consulting firm Gedas, which is based in Berlin.

But it said Friday's decision would have no impact on its earnings outlook for 2005. VW forecasts an increase in both operating profit excluding one-time items and profit before tax.

Ford Motor Co. announced earlier this month that it is selling its Hertz Corp. rental car business to a group of private equity investors for $5.6 billion.

Wolfsburg-based VW is reviewing its businesses in a drive to tighten its focus, identify cost savings and revive its sagging earnings.

Earlier this month, it announced plans to cut its work force in Germany, complaining that its factories have "several thousand" surplus employees, despite rising demand for its cars.

http://www.newscoast.com/apps/pbcs.dll/art...3/APF/509230680
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