VW profits hammered by diesel scandal

VOLKSWAGEN SAW its secondquarter profits more than halve as its financial performance took a hammering from the diesel emissions scandal.

The German car manufacturer said pre-tax profits plunged 57 per cent to 1.6 billion euros (£1.3bn) between April and June, down from 3.7 billion euros (£3.1bn) over the same period in 2015.

The firm said the VW brand, the group’s largest sales division, saw operating profit for the first half of the year tank by 35 per cent to 900 million euros (£758m), down from 1.4 billion euros (£1.2bn), as it felt the impact of currency fluctuations, lower sales volumes and higher marketing costs linked to “diesel-gate”.

Frank Witter, the group’s chief financial officer, said the firm had delivered “solid results in difficult conditions”.

He added that it would “require continued hard work to absorb the significant impact from the diesel issue”.

The company revealed in a surprise announcement last week that its operating result before special items rose 7.5 per cent to 7.5 billion euro (£6.3bn) for the first half of the year.

It also said that it would take a 2.2 billion euro (£1.8bn) hit to cover ‘’legal risks’’ in America linked to the diesel emissions scandal.

The firm estimates almost 1.2 million vehicles have been impacted in the UK.