Strong Volkswagen Q2 profit despite "dieselgate" cartel scandals

Source: Xinhua| 2017-07-27 20:40:56|Editor: Zhou Xin
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BERLIN, July 27 (Xinhua) -- German carmaker Volkswagen AG presented strong earnings figures for the second quarter of 2017 on Thursday.

Despite being at the heart of scandals surrounding diesel engine emissions and recent allegations of illegal collusion with other automotive firms, the Wolfsburg-based company more than doubled its Q2 operating profit (earnings before interest and taxes) to 4.5 billion euros (5.2 billion U.S. dollars).

Gross revenue rose by 4.7 percent to roughly 59.7 billion euros during the period, broadly in line with analysts' expectations.

The management board attributed the positive result to steady sales across its global market, as well as the progress of reforms at its flagship Volkswagen brand. Other car brands which are owned by the Volkswagen group include Audi, Porsche, Lamborghini, Bentley and SEAT.

A year ago, Volkswagen had achieved a comparatively meager 1.9 billion euros operating profit as the company digested costs imposed by the "dieselgate" scandal.

Volkswagen AG was the first German carmaker which was revealed to have installed illegal software which falsified emissions test results for its diesel vehicles in 2015.

On Thursday morning, the surge in operating earnings was not reflected in the price of Volkswagen shares listed at the German DAX index. The stock was down by 1.17 percent (10:44 am CET), as questions over the implications of the cartel scandal remained.

Over the weekend German newsmagazine Spiegel reported that Volkswagen is one of five German carmakers that stands accused of having colluded illegally on vehicle technology, cost, suppliers, markets and strategy since the 1990s.

Nevertheless, Volkswagen CEO Matthias Mueller seemed unperturbed and was visibly cheered by his firm's performance in Q2.

Speaking at the presentation of figures, he said that the "impressive result for the first half year, as well as the positive delivery of sales in June are a confirmation that the Volkswagen corporation is on the right path again."

The boost to profits offered a good foundation for investment into Volkswagen's transformation from a pure carmaker into a leader in electric mobility, Mueller added.

The European Union is currently investigating whether consumers were harmed as a consequence of illicit collusion in the German automotive industry.

Barbara Hendricks, German Minister for Environment, is expected at Volkswagen's flagship factory in Wolfsburg on Thursday. The German government will hold a "diesel summit" with industry representatives on Aug. 2 to discuss measures such as recalling and upgrading motors to lower the nitrogen oxide emissions of diesel vehicles.