Europe's top automaker Volkswagen (VOWG_p.DE) on Tuesday reiterated its revenue and margin targets for 2024 after posting a 20% drop in first-quarter operating profit hit by lower sales and higher costs, as it gears up to launch many new models.
"As expected, our first quarter results show a slow start to the year," finance chief Arno Antlitz said, adding that rising orders in March would have a positive impact on its second-quarter results. "We expect additional momentum over the course of the year from the launch of more than 30 new models across all brands."
In particular, the German automaker's luxury brand Porsche (P911_p.DE) reported a 14.8% operating margin decline on higher model revamp investments and lower demand for premium cars in China. The company's earnings were also hampered by delivery delays at its luxury Audi brand.
Volkswagen said last week it aims to keep its Chinese market share roughly stable until the end of the decade, betting on heavy investment to support sales despite a raging price war with local electric vehicle (EV) rivals.
The automaker said its order book remains stable versus the end of 2023 and orders for fully electric vehicles more than doubled in the first quarter versus the same period last year.
Volkswagen said it still expects 2024 sales revenue to rise up to 5% and a full-year operating profit margin of between 7% and 7.5%.
Earnings before interest and taxes (EBIT) came in at 4.6 billion euros ($4.92 billion) in the January-March period, in line with LSEG's mean estimate.
The company reported a 1% drop in revenue to 75.5 billion euros, above the LSEG mean estimate of 74.2 billion euros.
VW's vehicle sales fell 2% year-on-year, totalling 2.1 million units in the quarter.
