How the VW crisis threatens German football sponsorships
November 4, 2024
"We drive football."
This is the motto used by Volkswagen (VW) for its football sponsorship. In a narrow sense, the motto relates to the automotive group providing vehicles to football clubs and national teams. In a broader sense, however, it can also mean: "We promote football."
VW has taken up the cause of helping to develop football to become more diverse and enhance gender equality, but to what extent will they still be involved in football in the future?
How does VW crisis affect football?
Volkswagen, founded in 1937 under the Nazi regime, was the world's largest car manufacturer in 2023, with a record turnover of over €320 billion ($348 billion).
Last year, it delivered more than nine million vehicles to customers and employed almost 685,000 people worldwide.
However, it is now in the midst of a massive crisis. The group is reportedly planning to close three plants in Germany, with tens of thousands of employees fearing for their jobs.
Against this background, it is conceivable that VW will reduce its football sponsorship. The company's financial commitment in sports is probably in the three-digit million-euro range annually.
During the last major VW crisis, triggered by the emissions scandal in 2015, the car manufacturer allowed some sponsorship agreements to expire, for example with traditional German clubs Schalke 04 and 1860 Munich.
VfL Wolfsburg was a flagship project
VW has a tradition of financial support in football that goes back almost 80 years. VfL Wolfsburg emerged from the "Volkswagenwerk company sports association" in 1945 after the end of World War II.
According to the group, the
Bundesliga club at VW's headquarters plays a "flagship" role in the sponsorship strategy, but it's not known exactly how much money VW is pumping into the wholly-owned subsidiary. The club has a special exception from the 50+1 rule in German football, that stipulates no shareholder can have more than 50% control.
Due to its legal structure, VW is not obliged to disclose the figures, although it is currently said to be between €70 to €80 million a year.
The Wolfsburg men's team were crowned German champions in 2009 and German Cup winners in 2015.
The women's team can boast significantly more titles, winning the Champions League winners twice, the German championship seven times, and emerging as German Cup winners 11 times.
Volkswagen sees itself as a "reliable partner for its local clubs" not only in Wolfsburg. In other German cities with VW plants, the group also supports local football clubs right down to the amateur level, for example in Hanover, Braunschweig, Kassel, Dresden and Zwickau.
Volkswagen also works with the German record Bundesliga champions Bayern Munich in youth football.
In addition, VW subsidiary Audi is one of Bayern's top sponsors, holding 8.3% of the shares and providing company cars, among other things.
DFB contract reduced in scope
VW describes its commitment to the German Football Association (DFB) as an "outstanding example" of its sponsorship within football.
The group has been sponsoring the German Cup since 2012 and has been the main partner of the world's largest national football association since 2019.
This year, both sides extended the sponsorship agreement until 2028. However, according to media reports, VW reduced its support from roughly €30 million to around €20 million per year.
Volkswagen is the DFB's so-called mobility partner and supplies both the men's and women's national teams with vehicles, among other things.
Which other VW football sponsorships are at risk?
VW has also been an international "mobility partner" of several other football associations and their national teams for many years.
They have corresponding agreements with last year's World Cup runners-up France (since 2014), Switzerland (since 2014), Finland (since 2017), Luxembourg (since 2018), Denmark (since 2019), the Netherlands (since 2021) and Italy (since 2023).
They also have partnerships with two of the three next World Cup hosts. In Canada, VW sponsors the national professional men's league, the Canadian Premier League, and in the United States they are a "presentation partner" of the US Soccer Association.
Among other things, the VW logo appears on the training and warm-up jerseys of the men's and women's US national teams. That contract runs until the end of the 2026 World Cup.
The other international partnerships are also limited in time and could be allowed to expire for cost reasons.
The 2024 European Championship in Germany showed that not every sports sponsorship at Volkswagen is set in stone.
After VW had acted as UEFA's car sponsor at the previous Euros, they decided not to do so at this year's home tournament, of all tournaments, and left the field to Chinese electric car manufacturer BYD.
At the time, the company claimed the decision was about "an efficiency and cost-cutting program at all levels (...) with the aim of securing Volkswagen's future viability."
This article was originally published in German.