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VW announces record profits

Posted by GearUp on March 16, 2012 at 2:10 AM

Volkswagen has revealed the goal of becoming the world's most ecological car maker, off the back of record results for 2011. At a press conference in Wolfsburg, Germany this morning it announced an operating profit of £9.4 billion, up more than 50 per cent year-on-year.

The profits were achieved against eight million car sales, which resulted in sales revenue that rose 25.6 per cent to £133bn.

"The VW Group has extended its string of unbroken successes in 2011. We are making steady progress on our way to pole position in the automotive industry," said Professor Dr Martin Winterkorn, chairman of VW's Board of Management, referring to its goal of being sustainably the biggest car maker from 2018. It is currently behind GM and vying with Toyota in the battle to be the world's biggest car maker.

To achieve its ecological goals, Winterkorn announced a restructuring programme to hit the goal of having fleet average emissions of 120g/km of CO2 by 2015. Winterkorn said that to achieve this every new generation VW will have to cut emissions by between 10 and 15 per cent. As part of this programme, stop-start will be fitted as standard to all new models. In addition, Winterkorn outlined plans to lower emissions from the group's 94 plants by 25 per cent by 2018, which will require an investment of £250m.

Total sales were up by more than 1m vehicles year-on-year.

Sales were split between VW passenger cars (5.1 million cars, up 13.1 per cent year-on-year), Audi (1.3 million from 1.1 million), Skoda (879,000, up 15.3 per cent), Seat (350,000, up 3.1 per cent), Bentley (7003, up 36.9 per cent), Lamborghini (1600, up 23 per cent), VW Commercial Vehicles (529,000, up 21.4 per cent), Scania (80,100, up 25.7 per cent) and MAN, in which VW has recently taken a 57.33 per cent stake (24,750 sales).

Despite the sales growth, Seat was the only VW Group brand to make an operating loss. Volkswagen's chief financial officer Hans Dieter-Potsche said this was put down to a shrinking home market and heavy investment in new products.

In 2010 Bentley had also made a loss, which was attributed to the global economic situation. Bentley made a profit in 2011.

Winterkorn also signalled his optimism for 2012, despite the Eurozone's economic uncertainties. He said sales in January and February were up 7.7 per cent year-on-year.

"This year we will again be launching 40 new models, successors and product enhancements across the group," he said. "As a result we expect to increase deliveries year-on-year.

Winterkorn also reiterated that work to integrate Porsche into the VW Group is ongoing. "I can say today this will happen, but there are still hurdles to cross in our path towards that goal," said Winterkorn.

Winterkorn also announced each of the VW Group's 500,000 employees would enjoy a profit-share bonus of £6277 off the back of the record results, a figure up 90% year-on-year.

Winterkorn himself will receive £14.2m as part of his profit-sharing related bonus and salary.

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