Volkswagen steers back to profit in third quarter

Volkswagen steers back to profit in third quarter

VW said that it booked net profit of $3.2 billion in the three months to September

An employee is pictured at the headquarters of German car maker Volkswagen in Wolfsburg. Credit: AFP Photo

German auto giant Volkswagen said Thursday that, while its business was impacted heavily by the coronavirus pandemic this year, it managed to steer back to profit in the third quarter and still expected to end the year in the black.

"The Volkswagen group's business was heavily impacted by the Covid-19 pandemic in the first nine months of 2020, but recovered noticeably in the third quarter," Europe's biggest carmaker said in a statement.

"This means that the declines in deliveries, sales revenue and profit as of the end of September were significantly more moderate than at the half-year mark."

VW, whose brands include Porsche, Audi and Skoda, said that it booked net profit of 2.8 billion euros ($3.2 billion) in the three months to September, compared with a loss of 1.5 billion euros in the preceding quarter.

On a 12-month basis, third-quarter net profit was down by 31 per cent.

Underlying or operating profit fell by 30 per cent year-on-year to 3.1 billion euros and revenues slipped by 3.4 per cent to 59.4 billion euros in the July-September period.

In terms of unit sales, VW said it sold 2.6 million vehicles worldwide in the third quarter, 1.1 per cent fewer than in the corresponding period a year earlier.

"The clear recovery trend in the third quarter shows how robustly our company is positioned," said finance chief Frank Witter.

"Depending on the future course of the pandemic, we are cautiously optimistic that we will be able to continue to stabilise our business in the remaining months of the year and to put the Volkswagen group on a sustainably firm footing for the future."

Looking ahead to the full year, VW said it expects deliveries to customers to be "significantly down on the previous year in 2020 due to the impact of the Covid-19 pandemic.

"Overall, the Volkswagen group anticipates the operating result for 2020 before and including special items to be severely lower than in the previous year, however, in positive territory."