Volkswagen accelerates electric push

WOLFSBURG: Volkswagen would launch almost 70 new electric models by 2028, accelerating its rollout of zero-emission cars as earnings revealed the operating margin at its core brand had taken a hit from new emissions tests.

The profit margin at its core VW brand slipped to 3.8 per cent last year, down from 4.2 per cent, as higher investments into electric cars and challenges getting combustion-engined vehicles certified ate into profits, VW said.

Volkswagen released full earnings on Tuesday after pre-releasing earnings in February, when it said its 2018 group operating profit came in at 13.92 billion euros ($15.8 billion), 0.7 per cent higher than the prior year and below 14.53 billion euros forecast in a poll.

The carmaker’s Audi and Porsche brands made up the lion’s share of VW Group’s operating profit. Before special items, Audi’s operating profit accounted for 4.7 billion euros and Porsche’s 4.1 billion euros. Its VW brand delivered 3.2 billion euros in operating profit before special items, the carmaker said.

As a result of the electric cars model ramp up, Volkswagen expects to build 22 million cars on its electric vehicles platforms PPE and MEB by 2028, up from the carmaker’s previous estimate of 15 million cars.

Volkswagen stuck to its outlook, reiterating that it expects revenues to grow up to 5 per cent, and to deliver an operating return on sales at group level of between 6.5 per cent and 7.5 per cent in 2019.

Volkswagen’s Chief Executive Herbert Diess said he still believed that Britain and the European Union would strike an agreement to prevent a chaotic breakup of the European Union as Prime Minister Theresa May faces a crucial vote at home.

Reuters