Audi and Porsche the Volkswagen Group’s biggest profit centres

The German company delivered just under 7.1 million passenger vehicles (up 5.7 per cent) across its VW, Audi, Skoda, Seat, Bentley, Lamborghini, Porsche and Bugatti brands between January and September. It also sold 467,000 VW Commercials, Scania and MAN trucks (down 5.2 per cent).

As has been reported, this combined figure of about 7.53m deliveries places it second to Toyota (7.6m YTD) and a shade above General Motors (7.37m YTD) in the global race to be the biggest-volume car maker. 

The strong financial performance in the third quarter of the calendar year also drove YTD operating profits to 9.4b euros, up 10.0 per cent on 2013. 

Punching above their weight are premium subsidiaries Audi and Porsche, with respective operating profits YTD of 3.8b euros and 1.9b euros, generous operating margins of 9.7 per cent and 15.7 per cent and double-digit sales growth worldwide. 

Volume hub Volkswagen Passenger Cars recorded a profit of 1.7b euros, but a dip in operating margin to 2.3 per cent (down from 2.9 per cent) is cause for concern. 

VW continues to yield a skinnier operating margin than mainstream rivals, much of which is attributable to “higher upfront expenditures for new technologies”, or in other words, the costs associated with getting its ubiquitous MQB modular production platform up and running. 

The issue has been a long-running cause of consternation for global chief Martin Winterkorn, who has set the company a target of netting an operating return on sales of more 6.0 percent by no later than 2018.

The strong performance of Europe’s biggest automotive company is attributable to a bounce in European sales of 7.5 per cent and continued gains in the Asia Pacific led by China. This offset volume hits in North America and South America of 1.8 and 18.6 per cent. 

While Audi and Porsche were the financial engine rooms of the company, Skoda (651 million euro profit, 7.4 per cent operating margin), Bentley (124 million euro profit, 9.9 per cent operating profit) and Volkswagen Commercials (700 million euro profit, 5.4 per cent margin) all posted solid gains. 

The brand-by brand breakdown of YTD sales is as follows: 

VW Passenger Cars (4.6m sales, up 3.0 per cent); Audi (1.3m sales, up 10.0 per cent); Skoda (775,000 sales, up 13.0 per cent); Seat (294,000 sales, up 10.5 per cent; Porsche (135,600 sales, up 13.3 per cent); Bentley (7800 sales, up 19.5 per cent); Lamborghini (1570 sales, down 7.0 per cent) and Bugatti (36 sales, up from 25 this time last year).