GERMANY: Volkswagen Group nine-month operating profit plunges 55.9%

By just-auto.com editorial team | 30 October 2003

Volkswagen Group has reported an €813 million after-tax profit for the first nine months of 2003, down 55.9% on the €1,842 million booked in the same period of 2002.

Operating profit of €1,730 million was down 53.4%. Sales revenue fell 1.8% to €64,112 million and vehicle production was down just 1% to 3,742,000.

In a statement accompanying the figures, VW's board said the negative impact of the strong euro, declining sales in important markets and upfront expenditures for new models, as well as the restructuring charge in Brazil, depressed the group's operating profit in the first nine months of the year.

"With the launch of the Golf V as well as improving sales volumes from the new Touareg, Touran, Audi A3 and Audi A8 models and the new Transporter generation, we are expecting a stabilisation in the remaining months of the year in operating business. Our steps to optimise the product costs and to limit investment expenditures contribute to this," the statement said.

"A cautious assessment of the changed economic framework - in particular developments in automotive and currency markets - will lead to a revaluation of capitalised upfront expenditures in the context of the full year accounts. Taking these measures into account, the operating profit for 2003 will probably be just under half the level of the previous year," the board added.