German automaker Volkswagen AG said Thursday that its six-month net profit slipped nearly 81 percent to €494 million ($696.7 million) on decreased demand during the recession and that total sales this year will be less than in 2008.
BERLIN (AP) — German automaker Volkswagen AG said Thursday that its six-month net profit slipped nearly 81 percent to euro494 million ($696.7 million) on decreased demand during the recession and that total sales this year will be less than in 2008.
The Wolfsburg-based company, whose brands include Audi, VW, Seat and Skoda, earned euro2.5 billion in the first six months of 2008.
Sales from January to June fell 9.4 percent to euro51.2 billion compared with euro56.5 billion from January to the end of June in 2008.
The company did not offer a firm forecast for the rest of the year, citing what it called the “high volatility of market developments” but did say that it does not expect its earnings to reach the level of previous years.
It also said that its sales revenue will be lower this year than last because of a drop in demand for new cars, along with rising refinancing costs that “will serve as an additional drag on earnings.”
Despite its assessment, investors appeared unfazed, sending Volkswagen shares nearly 3.3 percent higher to euro249.57 in Frankfurt trading.
Like other manufacturers, including Daimler AG, the global recession has cut into demand for VW’s cars and trucks.
Europe’s biggest automaker by sales, which is in the process of adding Porsche to its stable of brands, did not immediately provide second quarter figures.