Moody skies ahead with the return of the Covid-19 virus to Europe, Volkswagen warns. Despite the … [+] Group returning to profitability, the Volkswagen brand still lost a billion euros in Q3. Photo: RONNY HARTMANN/AFP via Getty Images
AFP via Getty Images
The Covid-19 skid stopped for the Volkswagen Group in the third quarter, with the German powerhouse flipping a horror start to the year into a €3.2 billion ($3.8 billion) profit.
Despite an 18-percent drop in its global deliveries to 6.5 million vehicles year-to-date, Volkswagen finished the third quarter strongly by doubling its free cash flow to €6.22 billion and lifting its automotive net liquidity to €24.85 billion.
Rising demand in post-Covid China has helped, too, though Volkswagen’s joint-venture sales there with SAIC and BAIC don’t end up on its operating profit line.
After a €1.7 billion loss in the second quarter this year, when Covid-19 poleaxed sales in its European citadel, its adjusted operating profit climbed to 5.4 percent, a near straight swap from its second-quarter loss of -5.8 percent.
Effectively, the Volkswagen Group made a profit of €1380 per car in the third quarter.
Volkswagen has been on a cost-cutting drive as well as trying to pump out as many electric car (BEV) and plug-in hybrid (PHEV) sales as it can before the EU’s tight emissions laws close a trap around it.
It sold more cars globally in September than it did in 2019, Volkswagen said, though sales revenues fell to €59.36 billion.