- Volkswagen is making less profit
The Volkswagen Group saw its profits decline in the second quarter, but performed better than expected given the challenges facing its largest brands. Operating profit fell by 2.4% to €5.46 billion, the DAX-listed company reported. Analysts had expected a larger drop. Revenue rose by 4.1% to €83.3 billion, thanks to strong performance in financial services, despite lower sales in the quarter. However, net profit fell by 4.2% to €3.63 billion.
The group's core profit was impacted by setbacks in the daily business of key profit drivers Porsche and Audi, as well as the costs of job cuts at the core VW Pkw brand, which totaled €0.9 billion. The approximately €1.7 billion in special provisions for the potential closure of Audi's Brussels plant will likely only be incurred in the current third quarter, leading the company to lower its full-year outlook in early July. The management team, led by CEO Oliver Blume, reaffirmed this outlook.
Despite the challenges faced by brands like Porsche and Audi, the group managed to maintain a sizable car fleet, contributing to the revenue increase. The Volkswagen Group's earnings from car sales, though impacted, still formed a significant portion of its total profits for the quarter.
