Yet they now have competition from the unlikeliest of candidates: the group’s own captive financing business, VWFS.

Thanks to a global semiconductor shortage that has depleted stocks of new vehicles and forced consumers to scour used car dealerships for a new ride, the stable but otherwise unspectacular VW subsidiary is cleaning up by selling (or leasing) pre-owned models in a superheated market.

Not all carmakers operate their own financing units: The business requires solid credit ratings in order to afford the constant trips to debt markets for fresh funding. Some have opted to partner with more traditional specialists like Santander Consumer USA, an auto loan provider belonging to the eponymous Spanish bank. But those that do, whether BMW in Germany or Ford in the U.S., have enjoyed record results at these businesses, just like Volkswagen.

“We’ve earned more in the first half of 2021 than in the whole of 2016,” said VWFS chief executive Lars Henner Santelmann in a statement, forecasting record profits of €4 billion ($4.7 billion) this year. If it hits that mark, such a bottom-line haul would be equivalent to more than 20% of the VW group’s 2019 pre-COVID operating profit.

That kind of coin is typically earned only by the group’s lofty premium brand duo. The Volkswagen brand—which builds models such as the Tiguan SUV and Jetta sedan—could not match this level when it earned a record €3.8 billion in 2019. Porsche, the big margin generator in the VW group, contributed only €4.2 billion in its best year. 

Data published on Wednesday revealed a 25% year-on-year plunge in Germany’s new car market in July. With order books still full, industry insiders said the declines suggest remaining inventories of new cars that helped buttress sales amid the chip shortage have largely been picked clean.

This echoes recent group-wide data from the French parent of Renault and Dacia, whose stocks have steadily declined since the start of the pandemic.

Despite bottlenecks in semiconductors, all German carmakers have presented robust second-quarter results and raised their annual guidance at least once this year with increasing help from their used car business. BMW reported on Tuesday record first-half profit at its own captive financing unit, while Daimler hiked its forecasts for its leasing and loan business for the second time this year.

Volkswagen nevertheless doesn’t see its used car bonanza as a fluke of the COVID era, one that would normalize once there’s a healthy supply of semiconductor chips.

It aims to eliminate inefficiencies across European borders with the help of arbitrage, tracking down used cars in one country and selling them for a higher return in another. Once a Volkswagen had been sold in the past, the manufacturer had no idea where it would end up—something the company aims to change with the help of new group-wide IT platforms that can help gather data on its fleets, like Tesla before it.

“Our ambition is to ensure that this historic level of earnings at Volkswagen Financial Services is maintained over the next few years as well,” said Frank Fiedler, the division’s finance chief.