VW on track to overtake Toyota in global sales race

VOLKSWAGEN Group is on track to realise its long-held ambition of global sales leadership – three years ahead of its 2018 target date – after overtaking Toyota Motor Corporation (TMC) to become the world’s top-selling automotive company at the halfway mark of the year.

In terms of vehicle deliveries, the VW Group – which comprises a raft of brands besides Volkswagen itself, including Audi, Porsche, Skoda, Seat and others – reported earlier this month that it had handed over 5.04 million vehicles to customers from January to June, while Toyota – which also includes Lexus, Daihatsu and Hino – has this week posted a result of 5.02 million vehicle sales over the same period.

Both manufacturers have fallen compared to the first half of last year, with TMC sales slipping 1.5 per cent and VW down 0.5 per cent.

General Motors, which is in third place with 4.86 million global sales to the end of June, is also down 1.2 per cent so far this year.

Volkswagen AG global sales chief Christian Klingler described the group’s result as “satisfactory” given the difficult market conditions experienced in the first half, with a recovery in Europe only partly offsetting “tense” developments in South America, Russia and, particularly, China, “where growth on the overall market has been shrinking steadily since the beginning of this year and became negative in June for the first time in several years”.

However, the company now believes that its full-year deliveries may not improve on last year’s record 10.1 million sales.

Releasing its first-half financial results this week, which show that sales revenue climbed 10.1 per cent to €108.8 billion ($A163.3b) and operating profit grew by 13.0 per cent to €7.0 billion ($A10.5b), Volkswagen Group chairman of the board of management Martin Winterkorn said deliveries to customers in the second half should remain on a level with the previous year, despite a “persistently challenging market environment”.

“We are keeping a very close watch on global macroeconomic trends, especially where there are uncertainties such as in the Chinese, Brazilian and Russian markets,” Dr Winterkorn said.

Chief financial officer Hans Dieter Poetsch added: “The difficult market environment and fierce competition, as well as interest rate and exchange rate volatility and fluctuations in raw materials prices all pose challenges.” VW Group’s first-half profit before tax remained almost level at €7.7 billion ($A11.6b), “despite the negative effects from fair value measurement in the financial result”. Profit after tax remained unchanged compared to the same period last year, at €5.7 billion ($A8.6b).

The group’s luxury brands, particularly Audi and Porsche, continue to be key factors underpinning Volkswagen’s strong balance sheet, with Audi’s operating profit up 7.4 per cent to €2.9 billion ($A4.4b) and Porsche up 21 per cent to €1.7 billion ($A2.6b).