AutoBeta(AutoBeta.net)07/30 Report--

Due to the spread of the novel coronavirus epidemic around the world in the first half of 2020, the automobile industry suffered heavy losses and impacts. According to the results released from the automakers, a number of companies fell into operating losses, including Volkswagen Group, which leads the world in sales.

On July 30th, Volkswagen Group disclosed its first-half performance report, which was affected by novel coronavirus's pandemic, which had a significant impact on the business of Volkswagen Group and its brands, and its performance changed from profit to loss.

In the first half of 2020, Volkswagen Group's sales revenue was 96.1 billion euros (about 791.55 billion yuan), down 23.2 percent from a year earlier, while pre-tax profit fell to a loss of 1.4 billion euros (about 11.53 billion yuan), compared with a profit of 9.6 billion euros a year earlier, according to the report.

Excluding special items, Volkswagen Group posted an operating loss of 800m euros (about 6.59 billion yuan) in the first half, compared with an operating profit of 10 billion euros in the same period last year. Of this total, the expenditure on special projects caused by diesel emissions in the first half of the year was 700 million euros.

Volkswagen Group fell into a loss, which was greatly affected by the epidemic, while a sharp decline in sales also led to a sharp drop in revenue. In the first half of this year, Volkswagen Group sold 3.8931 million vehicles worldwide, down 27.4% from a year earlier.

Among them, Volkswagen's sales in Western Europe in the first half of the year were 1.2487 million, down 37.5% from the same period last year; sales in North America fell 26.2% to 285500; and sales in China were 1.59 million, down 17% from the same period last year. China is still Volkswagen's largest single market.

Volkswagen believes that global sales have gradually recovered with the relaxation of the blockade, but it expects sales to fall sharply for the whole of 2020 compared to 2019. At the same time, Volkswagen Group also made an expectation that full-year operating profit is expected to achieve positive growth, which means it will remain profitable.

"although results will deteriorate further in the second quarter, there is still hope for the second half of the year," Volkswagen Chief Financial Officer Frank Witter said in an internal letter. "the company aims to achieve positive operating profit before special projects by the end of the year."

Under the influence of the epidemic, automakers are under pressure. Toyota had expected operating profit to fall 80% to 500 billion yen (33.16 billion yuan) in fiscal 2020 (April 2020 to March 2021), the worst performance in nine years. Nissan expects a loss of 670 billion yen (44.6 billion yuan) in fiscal 2020.

Volkswagen lost money in the first half of the year, and the performance in the second half of the year is crucial, and the importance of the Chinese market to Volkswagen is self-evident. Volkswagen said it expected sales in China to remain in single digits this year, with new SUV and Audi models helping the group recover from the epidemic.

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