VW says operating profits up 20 percent in third quarter

VW says operating profits up 20 percent in third quarter

October 30th, 2013 by Staff Report in Local - Breaking News

German automaker Volkswagen AG said today its operating profits rose 20 percent in the third quarter as the company focused on holding down costs in a tough sales environment, according to The Associated Press.

The profits, which are measured before taxes and interest, rose to $3.8 billion even as sales revenue fell 3.8 percent, said the company that has its only U.S. assembly plant in Chattanooga.

''We are focusing on disciplined cost and investment management'' given that ''the economic environment is not expected to improve in the short term,'' CFO Hans Dieter Poetsch said in a statement.

Volkswagen has faced a tough market for cars in Europe, where sales have sagged because of slow growth and high unemployment in countries struggling with debt, particularly Spain, Italy, Greece, Ireland and Portugal.

Stronger sales in the U.S. and China have supported profits, along with the company's high-priced luxury brands Audi and Porsche. Sales of such vehicles can be more recession-proof and carry fatter profit margins. The company also sells cars under the SEAT, Skoda, Bentley, Lamborghini and Bugatti brands.

Volkswagen's worldwide vehicle sales increased 3.6 percent in the quarter to 2.38 million, even as they slipped 4.1 percent in the company's home market in Germany.