VW Profits Hit A Speedbump 🚘

VW Profits Hit A Speedbump 

Despite delivering a decent set of earnings this morning, two of VW’s historic cash cows, Porsche and Audi, were caught with one foot on the brakes. What’s this all about then?

On the whole, the auto industry has had a rough year, with slowing global growth and trade tensions between the US and China causing a great deal of pressure on performance. Moreover, multiple costly emissions scandals and tighter regulations have made it even tougher for automakers to find traction with their profits.

Porsche and Audi deliveries fell by 12% and 3.6% respectively in the first quarter, causing a sizable drag on VW’s Q1 performance. With China responsible for over 40% of VW’s sales, analysts are hoping that an end to the trade war will bring a revival in two of the company’s top brands.

Nevertheless, VW managed to offset the losses with strong performances from its VW and Skoda models, driving a 2.5% appreciation in its stock this morning. Despite its 400m Euro draw down in fines, revenues experienced a 7.1% boost, while operating profits rose 7.1%…Not bad all things considered.

Let’s hope VW can bring its two wayward cash cows back into the herd towards the end of 2019.

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