Volkswagen AG disclosed that its third-quarter operating earnings increased 46%, thanks to the demand for VW brand's Tiguan SUV and Audi's refurbished A6 sedan. Operating profit climbed to 2.89 billion euros or $4.05 billion from 1.99 billion euros last year, the company disclosed in its website. Revenue increased 25 % to 38.5 billion euros.
VW is expanding in the U.S. and China in an attempt to rise above Toyota Motor Corp. and replace it as the largest automaker in the world. VW is aiming to increase deliveries of SUVs, vans and cars by 11 percent this year to a record 8 million units.
The company plans to expend a record 62.4 billion euros within the next five years on models, facilities, and R&D to underpin its worldwide expansion. VW wants to employ at least 50,000 workers through 2018 as it aims for at least 10 million automobiles annually. Marc-Rene Tonn, an M.M. Warburg analyst recommending purchasing VW stock, confirmed that VW continues to perform "well in an increasingly challenging market place."
He added that the expansion is driven by a balanced model cycle and presence in key markets. He also added that the company "should be on track" to obtaining their 8 million sales target considering that its order books are full.
Volkswagen remains firm on its earlier estimates that EBIT and revenue for the whole year will be "significantly higher" versus in 2010. Net income increased more than three times to 7.04 billion euros. Profit was influenced by an increase from the revaluation of an option associated with VW's planned merger with Porsche Automobil Holding SE.