Scania XT in quarry

Volkswagen is considering spinning off its commercial vehicle division – comprising Scania, MAN, Volkswagen Caminhões e Ônibus and Rio– by the end of the year.

Although dependent on market conditions, Volkswagen is targeting an IPO of the commercial vehicles business as Traton Group.

Ahead of the biannual IAA show in Hannover, which begins on Thursday, Volkswagen said that now was the right time to set the course for the future of Traton.

Traton, formerly Volkswagen Truck & Bus, has also registered as a Societas Europaea, a public company registered in accordance with European Union corporate law.

Andreas Renschler, chief executive of Traton and member of the management board of Volkswagen - where he is responsible for commercial vehicles - said: “We expect to achieve capital market readiness by the end of 2018.

“Traton will now take the next steps at full speed,” added Renschler. “The employee representatives of Volkswagen, MAN and Scania have supported the path to capital market capability and the change into an SE in a very constructive way.

"For the employees of all brands working together under the umbrella of Traton, this strengthens the sustainable safeguarding of employment,” he said.

In 2017 Traton Group brands sold approximately 205,000 light commercials, HGVs and buses internationally. The group employs 81,000 people and produces vehicles at 31 sites in 17 countries.