Volkswagen Group Earnings, Sales Up

Cost cutting and increased sales have lead to a big earnings increase for Volkswagen in the third quarter of this year.

The Volkswagen group reported that quarterly earnings before interest and taxes jumped to $5.01 billion from $4.3 billion a year ago. Operating profit, though, dropped 48 percent to $2 billion.

That’s because of a $3.0 billion charge to fix diesel engines in the U.S.

Volkswagen bumped up their profit outlook for the year with the announcement, expecting a margin between six and seven percent.

Volkswagen has boosted its SUV lineup, especially in the U.S., where the all-new Atlas and the expanded Tiguan are both selling well. European SUV models like the Skoda Karoq and Seat Ateca are also boosting sales.

Total deliveries to customers hit 2,651,000, up 6.3 percent from the same quarter last year. That lead to total revenues of $63.76 billion, up 5.8 percent from the year before.

“Earnings in the first nine months make us quite optimistic about the year as a whole,” said VW CFO Frank Witter. “This is a strong foundation we can build on.”

Profit for VW doubled to $2.9 billion, thanks largely to cost cutting. Audi profit remained steady at $4.5 billion, and whil Porsche profits climbed slightly to $3.4 billion with help from the new Panamera, the margin was down slightly to 17.2 percent due to spending to build the Mission E electric sports car.