Volkswagen Group - Annual Report 2008 - Property, plant and equipment

CHANGES IN PROPERTY, PLANT AND EQUIPMENT BETWEEN JANUARY 1 AND DECEMBER 31, 2007
€ million	Land, land rights and buildings, including buildings on third-party land	Technical equipment and machinery	Other equipment, operating and office equipment	Payments on account and assets under construction	Total
Cost Balance at Jan. 1, 2007	14,141	24,538	31,311	1,518	71,508
Foreign exchange differences	2	–69	–48	–3	–118
Changes in consolidated Group	32	–	34	1	67
Additions	299	820	1,760	1,602	4,481
Transfers	120	563	532	–1,240	–25
Disposals	170	804	969	42	1,985
Balance at Dec. 31, 2007	14,424	25,048	32,620	1,836	73,928
Depreciation and impairment Balance at Jan. 1, 2007	7,214	18,801	25,146	7	51,168
Foreign exchange differences	–7	–29	–28	1	–63
Changes in consolidated Group	9	–	11	–	20
Additions to cumulative depreciation	472	1,730	2,628	–	4,830
Additions to cumulative impairment losses	2	24	414	–	440
Transfers	–2	–2	3	–	–1
Disposals	143	784	877	–	1,804
Reversal of impairment losses	–	–	0	–	0
Balance at Dec. 31, 2007	7,545	19,740	27,297	8	54,590
Carrying amount at Dec. 31, 2007	6,879	5,308	5,323	1,828	19,338
of which assets leased under finance lease contracts Carrying amount at Dec. 31, 2007	197	–	19	–	216

Call options on buildings and plant leased under the terms of finance leases exist in most cases, and are normally exercised. Interest rates on the leases vary between 2.9% and 14%, depending on the market and the date of inception of the lease.

Future finance lease payments due, and their present values, are shown in the following table:

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€ million	2008	2009 – 2012	from 2013	Total
Finance lease payments	31	97	133	261
Interest component of finance lease payments	10	22	15	47
Carrying amount/ present value	21	75	118	214

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CHANGES IN PROPERTY, PLANT AND EQUIPMENT BETWEEN JANUARY 1 AND DECEMBER 31, 2008
€ million	Land, land rights and buildings, including buildings on third-party land	Technical equipment and machinery	Other equipment, operating and office equipment	Payments on account and assets under construction	Total
Cost Balance at Jan. 1, 2008	14,424	25,048	32,620	1,836	73,928
Foreign exchange differences	–174	–495	–308	–117	–1,094
Changes in consolidated Group	1,389	959	110	294	2,752
Additions	437	1,118	2,420	2,676	6,651
Transfers	216	700	629	–1,523	22
Held for sale	44	30	111	6	191
Disposals	71	747	1,433	71	2,322
Balance at Dec. 31, 2008	16,177	26,553	33,927	3,089	79,746
Depreciation and impairment Balance at Jan. 1, 2008	7,545	19,740	27,297	8	54,590
Foreign exchange differences	–33	–238	–239	–8	–518
Changes in consolidated Group	0	0	0	–	0
Additions to cumulative depreciation	487	1,705	2,415	18	4,625
Additions to cumulative impairment losses	3	7	84	90	184
Transfers	3	–4	–9	11	1
Held for sale	25	25	72	2	124
Disposals	57	712	1,356	–	2,125
Reversal of impairment losses	–	0	–	–8	–8
Balance at Dec. 31, 2008	7,923	20,473	28,120	109	56,625
Carrying amount at Dec. 31, 2008	8,254	6,080	5,807	2,980	23,121
of which assets leased under finance lease contracts Carrying amount at Dec. 31, 2008	177	–	16	–	193

Call options on buildings and plant leased under the terms of finance leases exist in most cases, and are normally exercised. Interest rates on the leases vary between 2.9% and 13.6%, depending on the market and the date of inception of the lease.

Future finance lease payments due, and their present values, are shown in the following table:

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€ million	2009	2010 – 2013	from 2014	Total
Finance lease payments	39	77	124	240
Interest component of finance lease payments	7	10	15	32
Carrying amount/ present value	32	67	109	208

For assets leased under operating leases, payments recognized in the income statement amounted to €366 million in the reporting period (previous year: €408 million).

Government grants of €49 million (previous year: €10 million) were deducted from the cost of property, plant and equipment.

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13 Property, plant and equipment

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