VW Profit Gains as Sales Stall

Volkswagen Group reports its operating profit in the second quarter climbed 5% to €3.5 billion. Net profit dropped 16% to €2.7 billion.

Group deliveries shrank 3% to 2.6 million units in April-June. But revenue advanced 10% to €56 billion, aided by the weak euro and a richer product mix.

VW's group revenue in the first half of 2015 rose 10% to nearly €109 billion. Operating profit, excluding special items, grew 13% to €7 billion. Profit after taxes was unchanged at €5.7 billion. Group sales slipped 0.5% to 5.04 million units.

The company cautions that the remainder of the year will face continuing "fierce" competition, volatile interest and exchange rates, fluctuations in raw material costs and uncertainties in China and Russia. VW now expects full-year vehicle delivers could fall short of last year's record 10.1 million units.

First-half operating profits improved for the Audi (+7% to €2.9 billion), Porsche (+21% to €1.7 billion), the VW brand (+40% to €1.4 billion) and Skoda (+23% to €522 million). SEAT swung from a €37 million loss to a €52 million operating profit.

Results for VW's truck businesses were mixed in January-June. Operating profits for the group's Scania commercial truck unit climbed 6% to €503 million. But profits for VW Commercial Vehicles and MAN heavy trucks fell 4% to €268 million and 17% to €185 million, respectively.