The European motor giants multiply their profits despite reducing sales

The European motor giants multiply their profits despite reducing sales

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It seemed that the chip crisis that began last year was going to be a new blow that would once again drag car companies into a series of bad results, but no. The big European car manufacturers continue to increase their profits while their sales continue to decline due to missing components.

As happened last year (when, for example, the VW group shot up its net profit by 74.8% despite delivering 600,000 fewer vehicles), the accounts of European car companies in this first half have shown good results, despite the drop in enrollment. The reason for this increase in profits in this context is mainly that brands have focused on improving their margins by prioritizing sales of their premium models and brandswhich are the ones that bring in the most money.

By case, the one that has registered the most profits in the first half of the year has been the BMW group. The German company, which owns the BMW, Mini and Rolls-Royce brands, shot up its profits in the first six months of the year by 73.6%, to 13,232 million euros, while their registrations decreased by 13.4%, to 1.16 million units. The only brand of the group that increased its deliveries in this context of shortage of components was the luxury firm Rolls-Royce, which sold 6.8% more cars.

The giant Volkswagenfor its part, continued its path of increasing profitswhich shot up again by 25.8%, up to 10,638 million, while their registrations plummeted 22.2%, with 3.87 million vehicles sold. Thus, It seems complicated that Volkswagen is going to compete with Toyota for the world crown of saleswhich the Japanese snatched from him in 2020 and revalidated in 2021.

The two brands of the German group that fell the most in sales were precisely two general firms such as Skoda and Seat, which fell by 30% and 27.4%, respectively. On the contrary, the only VW firms that increased their deliveries were luxury Lamborghini (4.9% more) and Bentley (2.8% more).

“Despite unprecedented global challenges, Volkswagen has shown remarkable financial strength. The operating margin in the first half of the year reflects the strength of the product and the proportionally higher sales in the premium segment”, said the German company’s CFO, Arno Antlitzin the presentation of results of the Volkswagen group.

Stellantis goes off

Another European automobile giant that achieved great financial results during the first half of the year was the group Stellantis. The largest car producer in Spain (with its plants in Vigo, Figueruelas and Madrid) won the bronze medal for profits in the first six months, after increase its profits by 34%, to 7,960 million. Its sales also fell, but much less than those of its main competitor, Volkswagen.as they fell by 7.4%, with just over three million vehicles sold.

Stellantis’ Dare Forward 2030 strategic plan is moving full speed ahead, supported by record profitability and accelerating sales of low-emission vehicles. The manufacturer stressed that in Europe it is second in the sale of low-emission cars (including electric, plug-in hybrids and hydrogen), only a few thousand units behind the first.

The other European motor giant that managed to increase its profits in the first half was Mercedes Benzthat profits of 6,784 million were recorded, 3% more (if the truck business is not taken into account) compared to the same period of the previous year. It should be noted that the group split its business into two different companies in December 2021: on the one hand, its truck branch, Daimler Truckand on the other, the car and van company, Mercedes-Benz Group.

Renault, the discordant note

The reason, Russia. The French group Renault was the only European car company that has registered losses during the first half of the year. Specifically, the company led by Luca de Meo had red numbers of 1,666 million, due to its departure from Russia, a country that was the company’s second largest market. The exit from the region, which also involved the delivery to the Russian Government of its 67.69% stake in Avtovaz, the manufacturer that produces the Lada brand, had a negative effect for the company of 2,323 million. “Renault is determinedly pursuing its profound transformation and recovery of its activities. The results of the half year are proof of this: despite all the obstacles related to the cessation of activity in Russia, the semiconductor crisis and cost inflation, the group continues to improve its operational performance”, said De Meo.

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