• VfL Wolfsburg to play Wednesday in European Champions League
  • Volkswagen's soccer millions won't `flow as abundantly'

Volkswagen AG’s soccer team takes on Real Madrid on Wednesday evening in Wolfsburg, but the first-ever Champions League quarterfinal appearance for the carmaker’s hometown club stands to be the last for years to come.

Volkswagen, which owns VfL Wolfsburg and has been bankrolling its rise to the upper echelons of European soccer, is cutting spending as it faces billions of euros in fines and costs from the emissions-cheating scandal. That stands to end an era of paying for players able to compete with the likes of Real Madrid’s Cristiano Ronaldo.

“The millions probably won’t flow as abundantly as before,” said Frank Schwope, a Hanover-based analyst at NordLB. “Spending a lot of money on expensive players can have negative marketing effects in a situation like this.”

Volkswagen has already started cutting sports spending, which surged under former Chief Executive Officer Martin Winterkorn, an avid soccer fan. The company has ended sponsoring deals with German teams Schalke 04 and 1860 Munich and postponed plans for a new youth training center for VfL Wolfsburg. Rather then receiving a fresh influx of cash, VW’s club will hand over some of its 2015 income of more than 100 million euros ($113 million), manager Klaus Allofs told German newswire DPA on Tuesday.

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While Volkswagen will hardly pull the plug on its soccer unit, its ambitions may be scaled back. The company, which also owns a stake in Bayern Munich, so far has been vague about its plans for the club.

“We stand in principle by our engagement at VfL Wolfsburg,” Volkswagen CEO Matthias Mueller told Bild Zeitung in comments published Tuesday. The team “is an important point of identification for Wolfsburg and our employees.” A Volkswagen spokesman declined to comment beyond that statement.

Like its hometown, VfL Wolfsburg owes its existence to Volkswagen. The club was founded in 1945 to provide sports activities for the workers at the city set up by the Nazis to build cars for the masses. VfL stands for Verein für Leibesübungen, or association for physical exercise.

On the back of a recent spending spree, the professional soccer team, which didn’t play in Germany’s first division until 1997, qualified for the Champions League by finishing second in the Bundesliga and winning the German Cup competition last season. But even with its recent success, the team struggles to fill the 30,000-seat Volkswagen Arena. This season, it’s currently eighth with six games remaining, which would put it out of contention for lucrative European competitions.

Volkswagen’s crisis over duping regulators with software that turned on full pollution controls only during tests has spilled over to the team’s games. During a Champions League encounter last month against KAA Gent, Belgian fans were ejected after unrolling a banner that read: “We don’t need cheating software.”

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