VW reports profit drop, raises job cuts to 100,000 amid China sales slump
8 reported
Volkswagen has reported a steep fall in profits and cut its revenue forecast, citing a sales slump in China. The German carmaker said it expects sales revenue to fall by up to 3% this year, reversing a previous forecast for a 3% increase on last year’s €321.9bn. The company confirmed it is raising its job cuts target to 100,000, double the number already agreed by unions. Operating profit fell by 9.5% to €3.5bn in the second quarter, below analysts’ estimates. The proposed additional job cuts would mostly be in administrative positions across its global business. Volkswagen’s share price fell 1.5% after the release of its latest financial results and is down 66% over the past five years.
What’s reported
Volkswagen reported a 9.5% drop in operating profit to €3.5bn in the second quarter, below analysts’ estimate of €3.9bn.
The company cut its revenue forecast to a decline of up to 3% this year, from a previous forecast of a 3% increase on last year’s €321.9bn.
VW confirmed it is raising the job cuts target to 100,000, double the number already agreed by unions.
The additional job cuts would mostly be in administrative positions across its global business.
Volkswagen’s sales in China fell by more than 31% in the first half of the year.
The company delivered 6.3% fewer cars globally in the first half, about 4.1m.
Volkswagen’s share price fell 1.5% after the results and is down 66% over the past five years.
The plans also include reducing Volkswagen’s model line by up to half.
Key figures
Oliver Blume, chief executive of Volkswagen
Russ Mould, investment director at AJ Bell
Sources: The Guardian
