Volk­swa­gen profit up 19% as cost-cut­ting takes hold

The China Post - - WORLD BUSINESS - BY DAVID MCHUGH

Au­tomaker Volk­swa­gen says first quar­ter profit rose 19 per­cent as cost-cut­ting im­proved profit mar­gins at its name­sake brand and Euro­pean auto sales show a mod­est re­cov­ery.

Net profit rose to 2.93 bil­lion eu­ros (US$3.23 bil­lion) in the Jan­uary-March quar­ter, from 2.47 bil­lion eu­ros in the same quar­ter a year ago.

Volk­swa­gen AG said Wed­nes­day that its ef­forts to re­duce costs had saved more than 100 mil­lion eu­ros in the quar­ter alone at the Volk­swa­gen brand, rais­ing the profit mar­gin to 2.0 per­cent from 1.8 per­cent. The Volk­swa­gen brand was still hit by fall­ing sales in Rus­sia, which is suf­fer­ing from eco­nomic sanc­tions over Ukraine and a fall in the ru­ble, and in South Amer­ica.

But the brand gained ground in Spain, Bri­tain and Ger­many dur­ing the quar­ter. Euro­pean auto sales in gen­eral are bounc­ing back slowly as the econ­omy re­cov­ers from a cri­sis over high gov­ern­ment and bank debt in the 19 coun­tries that use the euro cur­rency.

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