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VW profits may fall as sales in S Africa, S America plummet

Volkswagen lowered its profit projections for the year yesterday, citing slumping sales and earnings in the first six months of the year.

Chairman Bernd Pischetsrieder said VW is expecting earnings to weigh in at 4 billion euros, or about 9 percent lower than the previous 4.4 billion euros projection. Pre-tax earnings in the first six months dropped 4.1 percent to 2.26 billion euros, while the net profit fell 3.5 percent to 1.4 billion euros.

The earnings downturn came while revenues slumped by 3.2 percent to 44.06 billion euros, with Pischetsrieder saying that the second half of the year was not expected to provide any new boost to business.

A bright spot in the cars sales figures was a 17.3 percent rise in the Asia-Pacific region, VW reported. There was also a 1.6 percent improvement in car sales in North America.

But these gains were not enough to compensate for a 17.2 percent plunge in sales in the South America/Southern Africa markets and 7.7 percent drop in Europe, VW said.
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