VW Group 2024 Q1 Sales Profit Sees 20% Drop

Low volume and increased costs saw VW Group Q1 2024 sales experience a 20% drop in profits.

Following a 20% decline in operating profit in the first quarter (Q1) of 2024, Volkswagen Group (VW Group) has elected to revise its expectations for revenue and margin. The group had posted an earning before interest and taxes (EBIT) figure for the Jan–March quarter that stood at €4.6 billion (approx. RM23.4 billion). 

Reduced sales and increased expenses have affected the company's performance as it gets ready to introduce more than 30 new models through various brands, which include Porsche, Audi, Bentley, VW, Skoda, and Seat/Cupra.  According to the CFO of VW Groups, Arno Antlitz, the slow star was an expected result.  

He was confident, nonetheless, that second quarter (Q2) sales will surpass Q1 sales in terms of performance. "A strong March, the solid order bank and the improving order intake in the past months are encouraging and should already have a positive impact in the second quarter," he added.

The drop also stemmed from the Porsche brand's recorded 14.8% decresse in operating margin.

This drop also saw its Porsche brand also announce a 14.8% decrease in operating margin as a result of increased model redesign expenditures and a reduction in China's demand for high-end vehicles. 

Problems related to customs procedures also affected the shipment of Audi and Porsche vehicles. During the quarter, group car sales decreased by 2% to 2.1 million vehicles, while revenue decreased by 1% to €75.5 billion (approx. RM384.04 billion). 

VW Group projects a 5% increase in sales revenue, and a 7%-7.5% increase in operating profit margin, for 2024 despite the slow but expected start to the year.

VW projects a 5% increase in sales revenue and an operating profit margin of 7% to 7.5% for the entire year of 2024. 

With over 30 models expected to be released this year, the company anticipates more growth as it makes significant investments to update its lineup, especially in the fiercely competitive Chinese market. KR