VW Profits to Fall Due to Weakness in German Market

VW Golf VII 1 photo
Photo: Volkswagen
Due to strong demand in China or the US, most German makers of premium automobiles were able to report increasing sales and profits despite weakness in their domestic market. However, this no longer seems to be the case, as Daimler is looking at smaller and smaller profits from the Mercedes Benz division.
That might also be the case with Europe’s largest automaker, Volkswagen, as the state of the overall European market is affecting market sentiment in Germany.

Bloomberg expects that VW will announce an operating profit of €2.3 billion ($3 billion) for the third quarter of 2012. This would be a 20-ish percent compared to last year, the first one since the 2009 global recession.

However, VW is still far better off than European rivals like PSA Peugeot Citroen and Fiat Group, who are reporting unprecedented losses.

VW also has a brand new Golf generation coming up, which will be produced side by side with the old one until the end of the year. The Golf is their biggest money maker, but margins will be tight in the competitive European market.

What crisis? This crisis!
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About the author: Mihnea Radu
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Mihnea's favorite cars have already been built, the so-called modern classics from the '80s and '90s. He also loves local car culture from all over the world, so don't be surprised to see him getting excited about weird Japanese imports, low-rider VWs out of Germany, replicas from Russia or LS swaps down in Florida.
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