Volkswagen Group profits decreased to €2.3 billion in Q1, down from a record €3.2 billion a year earlier. Global deliveries increased by 4.8% to 2.3 million vehicles worldwide as the Group’s share of the passenger car market rose year-on-year to 12.6% from 12.2%.
However, in spite of this improved performance in global markets, sales revenue during the first three months amounted to €46.6 billion down from €47.3 billion during Q1 of 2012. The Eurozone crisis caused sales declines at the Audi, Volkswagen and Škoda brands. In Germany alone sales were off -7% with a loss of 21,000 units. Moreover, a shift down market and increased sales incentives hurt revenues.
Nowhere was this more evident than at Volkswagen brand whose sales of 1.1 million cars were down 2.4% on the prior-year figure. The brand’s operating profit at €590 million fell sharply from €1,100 million the year before, and was hurt by lower volumes and so-called negative mix effects as customers bought less expensive models.
Audi, responsible for much of the Group’s profits, also recorded a unit sales decline to 330,000 vehicles (340,000 Q1 2012), 2.9% fewer than in the prior-year quarter even though the Chinese joint venture FAW-Volkswagen sold 88,000 Audi vehicles. Audi generated an operating profit of €1.3 billion down from €1.4 billion in 2012.
Škoda’s sales declined by 13.3% to 179,000 vehicles (206,000). Its operating profit dropped to €112 million (€209 million) because of lower volumes, negative mix effects and higher launch costs for new models.
Seat sold 111,000 vehicles (99,000) worldwide, 11.4% more than in the previous year. The operating loss widened from €29 million in the previous year to €46 million this quarter.
Bentley delivered 2,000 vehicles (2,400) and its operating profit rose to €27 million (€15 million). Sports car manufacturer Porsche sold 36,000 vehicles and made an operating profit of €573 million in the first quarter of 2013.
“We are approaching the rest of the year with our usual realism and great vigilance,” said Group CEO Martin Winterkorn. He is confident that, despite all the economic uncertainties, the Volkswagen Group can pick up speed as the year progresses and outperform the market as a whole.
Thus far, the Volkswagen Group is affirming its previous stated goals for 2013. Deliveries to customers are expected to increase year-on-year. The Group’s 2013 sales revenue is expected to exceed the prior-year figure. Given the ongoing uncertainty in the economic environment, the Group’s operating profit goal is to match the prior-year level in 2013.