Volkswagen’s profit increased in the first half of 2012 thanks to Audi demand

Article by Christian A., on July 27, 2012

For the first half of 2012, Volkswagen Group’s profit gained 7% as the high demand for Audi vehicles in China and the U.S. protected it from the impact of the debt crisis in Europe. Its operating profit increased to a record-breaking figure of 6.49 billion euros ($8.0 billion) from 6.09 billion euros the previous year. Its sales increased by 23% to 95.4 billion euros.

Volkswagen has lessened its exposure to the European new-car market due to its expansion in China and the U.S. The European auto industry is predicted to fall for the fifth straight year as the debt crisis weakens the buying power in the region.

The demand for models, ranging from the VW Up minicar to the Lamborghini Aventador to heavy trucks from Scania increased sales by 12.4% to 4.6 million vehicles in the first half, boosted by the 12% gain of the Audi brand. In a statement, VW said that “positive effects” resulted from its “attractive” model lineup and strong market position.

These are partly offset by increasingly stiff competition in a demanding market environment, particularly in certain European countries. Volkswagen stayed with its goal to match the operating profit last year of 11.3 billion euros as higher revenue and auto deliveries offset higher development expenses as it overhauls the Audi A3 premium compact and top-selling VW Golf compact. Bloomberg surveyed 21 analysts who said that the average estimate for 2012 earnings before interest and taxes is 12.1 billion euros.

More than a decade and a half since Audi launched the A3 in 1996 – thereby creating the premium compact segment -- the luxury carmaker will soon be introducing the third generation of the vehicle 2012 Geneva Motor Show. The new Audi A3 is entering a new chapter with the latest-gen premium compact, which is laden not just with technologies and innovations but also with eco-friendly systems.

The third generation of the Audi A3 will be offered not only as powered by gasoline and diesel, but also by electricity, a combination of gasoline and electricity natural gas and the so-called Audi e-gas, thanks to the availability of alternative drive systems. In fact, an Audi A3 could be powered by a newly developed 1.6-liter TDI engine that eats up just 3.8 liters of diesel per 100 km, allowing the compact car to achieve 61.9 miles per gallon of fuel. Moreover, this engine only emits 99 grams of carbon dioxide 159.33 grams per mile.

Another advancement implemented on the new A3 is the so-called Audi ultra-lightweight technology, which allowed the third generation iteration to be lighter by 80 kg (176.4 lbs) than its predecessor. Likewise, Audi has made sure that the chassis of the A3 allows for sporty yet agile drive. Supporting the capabilities of the new A3 is a horde of driver assistance and infotainment systems.

Parading the sportiness of the new generation A3 is its unique styling, as underpinned by its splendid dimensions -- 4.24 meters (13.91 feet) in length and 2.60 meters (8.53 feet) of wheelbase. Although this length is similar to that of its predecessor, the new Audi A3 features low-angled C-pillars, just like on a coupe. Underlining the aggressive nature of the A3 is its single-frame radiator grille flanked by elegant headlight units, which could be availed in xenon plus technology along LED daytime running lights and LED rear lights.

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Topics: vw, profit, audi

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