Europe South Asia Asia Pacific Americas Middle East Africa BBC Homepage World Service Education



Front Page

World

UK

UK Politics

Business

Sci/Tech

Health

Education

Sport

Entertainment

Talking Point
On Air
Feedback
Low Graphics
Help

Tuesday, February 23, 1999 Published at 21:10 GMT


Business: The Company File

Car giant's bumper profits

The new face of a stalwart of VW's trade, the Beetle

Europe's largest car manufacturer, Volkswagen, has reported a massive jump in profits.

Its coffers have swelled with its profits after tax shooting up by 65% during 1998.

The news comes after VW launched into the US market some months ago a new version of its much-loved Beetle car.

Initial demand was reported to be huge as car dealers struggled to satisfy the number of customers turining up on their forecourts.

VW gloom

But Volkswagen dampened its good news with a warning that global economic difficulties will make it tough to beat this figure this year.

It made 2.24bn DM($1.26bn/1.15bn euros) up from 1.36bn DM($767m/697m euros) in 1997.

Details of the year's profit will be presented at a news conference on 25 March.

"The 1998 figures were absolutely fine. The results are a bit off the point now. What's important is the warning that it will be difficult to achieve a further improvement in earnings in 1999," said Stephen Reitman, an analyst at Merrill Lynch, in London.

"I think they are taking a hyper-cautious view," he added. "We know that their incoming orders are in pretty good shape, except with markets like Brazil and the Czech Republic."

"A further improvement in group net profit in 1999 will be difficult to achieve given the crises in the global automobile markets," Volkswagen said in a statement.

The company said it would pay a higher dividend on shares, paying 1.5 marks per share ($0.85 /0.77 euros) compared to 1.2 marks ($0.68/0.62 euros) this time last year. Pre-tax profits were up 63.4% at 6.287bn DM.

Car sales were 18.5% higher at 134.243bn DM.





Advanced options | Search tips




Back to top | BBC News Home | BBC Homepage | ©


The Company File Contents


Relevant Stories

10 Feb 99 | The Company File
BMW 'not for sale'

28 Jan 99 | The Company File
Automotive Empires

13 Jul 98 | Business
Audi sells Cosworth Racing to Ford





Internet Links


Volkswagen


The BBC is not responsible for the content of external internet sites.




In this section

Microsoft trial mediator welcomed

Vodafone takeover battle heats up

Christmas turkey strike vote

NatWest bid timetable frozen

France faces EU action over electricity

Pace enters US cable heartland

Mannesmann fights back

Storehouse splits up Mothercare and Bhs

The rapid rise of Vodafone

The hidden shopping bills

Europe's top net stock

Safeway faces cash demand probe

Mitchell intervenes to help shipyard

New factory creates 500 jobs

Drugs company announces 300 jobs

BT speeds internet access

ICL creates 1,000 UK jobs

National Power splits in two

NTT to slash workforce

Scoot links up with Vivendi

New freedom for Post Office

Insolvent firms to get breathing space

Airtours profits jump 12%

Freeserve shares surge

LVMH buys UK auction house

Rover - a car firm's troubles