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WOLFSBURG (dpa-AFX) - After a slow start to the year, the Volkswagen Group expects business to pick up in the coming months. "We expect a significant improvement as early as the second quarter," said CFO Arno Antlitz on Tuesday at the presentation of the balance sheet for the first three months. "A strong March, the solid order situation and the improvement in incoming orders in recent months are encouraging." Despite the sluggish start, he was therefore confident of achieving the targets he had set himself for the year as a whole and increasing sales, turnover and profits. However, the VW share fell noticeably.

In the afternoon, the stock lost 2.3 percent to 118 euros in a weak industry environment. The share price had recovered in recent months, starting from the lows in the fall at below 100 euros in some cases. Since February, it has essentially hovered around 120 euros.

The start to the year was largely sluggish as expected, but the development in cash flow was not anticipated to be so weak, wrote analyst Philippe Houchois from investment bank Jefferies. JPMorgan expert Jose Asumendi spoke of a "stable start" to the year. The outflow of funds in the first quarter was due to stockpiling for the upcoming product offensive.

In the months from January to March, Europe's largest car manufacturer suffered above all from weak new business. Turnover shrank by one percent to just under 75.5 billion euros, while operating profit fell by as much as a fifth to 4.59 billion euros. The corresponding operating margin fell by 1.4 percentage points to 6.1 percent and was therefore below the targets for the year as a whole, as already announced by management. On average, analysts had expected slightly lower losses. At the bottom line, the Group still earned 3.7 billion euros in the three months, one billion euros less than a year earlier.

VW attributed the weaker operating result to the lower sales volume, a less favorable sales mix for brands and models as well as higher fixed costs. The market launch of new models at Porsche, a pearl of profitability, and delivery bottlenecks at Audi weighed on the Group figures. By contrast, the Group with the mass brands VW Passenger Cars, Seat/Cupra, Skoda and VWN (light VW commercial vehicles) earned more than a year earlier.

The Group had already reported an increase of a good three percent in deliveries to end customers in the middle of the month. However, sales, which are decisive for turnover, fell by two percent to 2.08 million cars. While dealers handed over more cars to customers than a year earlier, the Group sold fewer vehicles to these same dealers, which reduced profits.

New business slowly picking up again

The weak new business was a particular problem for the Group, especially for electric cars. Following the discontinuation of the state purchase incentive at the end of 2023, demand here had formally collapsed. Business with electric cars, which are important for VW, is now picking up again, said Antlitz. "We had a weak January, but February and March were strong." Compared to the previous year, the number of newly ordered e-vehicles more than doubled in these two months.

Overall, incoming orders also picked up in March, said Antlitz. Thanks to numerous new models such as the Golf facelift and the new Passat, he expects order numbers to continue to rise in the coming months, especially for e-cars. In addition, the order book is still well filled. In Europe alone, the order book stands at 1.1 million vehicles, 160,000 of which are e-cars.

VW needs the e-cars above all in order to meet the EU targets for the fleet's CO2 emissions. Antlitz is confident that this will be achieved this year. And next year, when the EU tightens the targets, the company also wants to achieve this. "2025 will be more challenging," Antlitz admitted. "But from today's perspective, we can manage that too."

Audi as the new problem child

In the first quarter, the subsidiary Audi, which along with Porsche had previously been considered a stable source of income in the Group, became a particular burden. Because there were not enough V6 and V8 engines for the high-yield top models, sales and profits collapsed. With a return on sales of only 3.4 percent, Audi was even behind the traditionally weak core brand VW, which achieved 3.7 percent.

Antlitz announced that the engine bottleneck would now be resolved quickly. Audi is in the process of increasing capacity for the large engines and bringing new suppliers on board. We will see an improvement in supply in the coming months. "Audi will return to its former strength," Antlitz said confidently./fjo/men/ngu