Volkswagen AG announced an increase in profit to 1.71 billion euros or $2.51 billion, a significant rise from the 473 million euros that it had managed during the same period last year. The profit figure released by the company also beats the 1.63 billion euros average estimate that seven analysts complied by Bloomberg had earlier predicted. This marks an increase in the company’s revenue by 31 percent to an impressive 37.5 billion Euros. According to the company CEO, Mr. Martin Winterkorn, the surge in demand in China will further help profit as well as company revenue to peak. The company also stated that deliveries for 2011 will increase by 5 percent from 7.2 million vehicles it delivered in 2010.
VW product deliveries in China alone has increased by about 20 percent in the first quarter of this year. The company announced it has sold 1.97 million units worldwide in the first quarter, with several models such as the VW Tiguan compact SUVs along with the new Audi A7 Sport back and the revamped A8 Sedan making up the bulk of the sales. This apart, the company is also looking at various emerging markets such as China, Brazil, India and Russia to achieve its stated goal of becoming the world’s largest automaker, for which it will have to outperform Toyota Motor Corp.
Also, net liquidity of Volkswagen’s automotive division continued to be high at 19.6 billion Euros during the first quarter after it had increased 1 billion euros during this period. What makes it even more impressive is the fact that the company liquidity increased despite Volkswagen’s ambitious takeover of Porsche Holding Salzburg, Europe’s biggest car retailer in a deal worth 3.5 billion euros. That’s not all for Volkswagen picked up a 8.18 percent stake in Germany-based SGL Carbon, which made VW become the second largest shareholder of SGL, next only to BMW AG.