Volkswagen, Europe's largest carmaker, disappointed markets with an 81 per cent decline in third-quarter operating profit and reaffirmed its forecast for a full-year drop in earnings.
"The group's sales revenue in 2009 will be lower than in the previous year in particular because of weaker volume sales. Rising refinancing costs and mix deteriorations will serve as an additional drag on earnings," it said in its quarterly report today.
"We continue to expect that our earnings will not reach the level of previous years," VW added.
Still, the company said it should be able to decouple itself from the downward trend in overall car markets and gain share at the expense of others.
Third-quarter operating profit dropped to €278 million. It was weighed down by heavy losses at its Spanish value brand Seat and at ultra-luxury marque Bentley.
Automotive net cash flow in the first nine months was strong at €5.1 billion, lifting net liquidity to €13.4 billion at the end of September.
"The trend in the automotive industry means that there is no reason for premature optimism. The business climate remains tough," chief executive Martin Winterkorn said in a statement.
Reuters
