Cost-cutting program at Volkswagen brand bears first fruit

By Thomson Reuters Mar 14, 2024 | 4:37 AM

BERLIN (Reuters) – Volkswagen said on Thursday that operating profit for its core mass-market brands increased by 80% last year, in a sign that closer cooperation between them is bearing fruit.

The group including Volkswagen, Volkswagen Commercial Vehicles, Skoda and SEAT/CUPRA posted operating profit of 7.3 billion euros ($7.99 billion) in 2023, mainly due to higher unit sales.

“Through close cooperation between our brands, we are working more efficiently, becoming more competitive and boosting our innovativeness for our customers worldwide,” said Volkswagen’s Thomas Schaefer, head of the core brands.

Related effects from the closer cooperation should bolster results this year, said the German carmaker, which also expects more sales due to a better raw materials and components supply.

On Wednesday, Volkswagen said the operating profit margin for the group’s core mass-market brands rose to 5.3% last year from 3.6% in 2022, with the company targeting 8%.

($1 = 0.9140 euros)

(Reporting by Christina Amann; Writing by Miranda Murray; Editing by Madeline Chambers)