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VW Group’s profit falls in the second quarter

Posted on by darion

Oliver Blume

Volkswagen Group revenue fell in the second quarter as the company’s financial result came under pressure from one-time restructuring costs and lower returns on deliveries in China.

The Volkswagen Group’s earnings before interest and taxes (EBIT) for the second quarter of 2024 amounted to EUR 5.46 billion, down 2.4% compared to the previous year.

The Porsche brand in particular struggled with supply chain issues and low sales in China in the first half of the year.

The decline in operating profit in the first half of 2024 (compared to EUR 11.3 billion and EUR 10.1 million) is due to several exceptional factors, including the severance program at Volkswagen AG.

The operating margin was additionally impacted by higher fixed costs, costs related to the deconsolidation of VW Bank Russia and the closure of part of the gas turbine business at MAN Energy Solutions.

Operating sales profitability in the first half of 2024 was 6.3% (6.6% in the second quarter).

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Volkswagen CEO Oliver Blume said: “We are accelerating our global software strategy in cooperation with international partners and have completely reorganised our business in China.”

He added: “However, there is still a lot of work ahead of us.”

In a statement, Chief Financial Officer Arno Antlitz said the 6.3% yield was “too low.”

“To achieve our goals, we will need to make significant cost-cutting efforts in the second half of the year and beyond.”

He added: “We need to make significant cost efforts in the second half of the year and beyond to achieve our goals.”