The Volkswagen Passenger Cars brand recovered “noticeably” in the third quarter of 2020 after the pandemic related slump in the first half of the year, the automaker said on Monday (2 November).
Worldwide vehicle sales dipped 2.7% year on year to 1.5m while year to date volume fell 18.6%.
Sales revenue fell 27.9% to EUR 47.2bn after nine months versus a 35.3% drop in the first half. The brand managed to book an operating profit – before special items – of EUR 522m versus a nine month loss of EUR1bn but that was an improvement on the first half’s EUR1.5bn in red ink.
CFO Alexander Seitz said: “Despite the ongoing challenges from the COVID-19 pandemic, the brand returned to profitability in the third quarter. This is above all due to the systematic measures taken to cut costs and secure liquidity and the dedicated efforts of our employees, who gave their all to catch up on the backlog following the temporary shutdown in spring. Thanks to our strong product substance, we are gaining market share in many regions. In the final quarter, we are doing everything in our power to get the brand’s full-year operating result into positive territory.”
Gradual recovery continues
VW said the gradual improvement in sales was boosted by the new compact electric vehicle, the ID.31 – 20,000 have already been delivered – as well as plug-in hybrids, said to be in high demand, plus “significant pick up” in demand for the redesigned Golf 8.
“Despite signs of a recovery, the further development of the COVID-19 pandemic remains difficult to forecast,” VW said in a statement.
“The brand will therefore continue the strict cost management measures it has initiated. In this way, it successfully reduced fixed costs in the first nine months. For 2020 as a whole, the brand still anticipates deliveries and sales revenue to be significantly below the 2019 level. The operating result before special items is expected to be severely lower than in 2019, but still positive.”