Embattled VW says net profit falls 57%

Scandal-struck car manufacturer Volkswagen said yesterday that its profits fell in the second quarter by 57 per cent to €1.15 billion (Dh4.7 billion, $1.3 billion).

Second-quarter profits were weighed down by almost €2.5 billion of special items, mostly related to 2015’s diesel emissions cheating scandal.

“Further enormous feats of strength will be needed to contain the high costs of the diesel question,” finance director Frank Witter said in a statement.

The group obtained provisional approval in July for a $14.7 billion settlement to US buyers of some Audi and Volkswagen diesel vehicles, putting one important element of the fallout behind it.

But risks remain from other legal cases dragging on in the US and Germany, where prosecutors have broadened their investigation into the diesel emissions cheating.

VW shares fell by just over two per cent in early trading on the Frankfurt stock exchange in response to the result.

The full second-quarter figures come one week after a provisional release of better-than expected results for the first six months of 2016.

Yesterday’s figures were boosted by higher unit sales of luxury models from Audi and Porsche and mid-range Skoda over the first half of the year.

But the group’s core Volkswagen-branded vehicles saw a decline of almost one per cent in sales in the six months from January to June compared with the same period in 2015.