A car assembly line worker wears a protective face mask when Volkswagen AG (VW) restarts production at its headquarters factory in Wolfsburg, Germany, Monday, April 27, 2020. Volkswagen is restarting production at its plant. Auto Industry Wolfsburg, the world’s largest, with A group of labor leaders warned that the political consequences of the coronavirus pandemic could be more damaging than interruptions in production.
Bloomberg
Volkswagen has reported an operating loss of 800 million euros ($ 940 million) for the first half of 2020 and reduced its dividend as the coronavirus pandemic affected car sales.
This compares to a profit of € 10 billion for the same period last year. Group sales fell 23.2%, while deliveries fell 27.4% yoy, with a percentage gap from last year’s performance that fell steadily since May as closures worldwide caused a crater on the demand.
At its annual general meeting in September, the German automaker will now propose a dividend per common share for fiscal year 2019 of 4.80 euros, down from the previously announced 6.50 euros.
While warning that “challenges will also arise particularly from the increasing intensity of competition, volatile commodity and currency markets and stricter emissions-related requirements,” Volkswagen said it still expects to be profitable for the full year.
Frank Witter, a member of the Board of Directors for the Group responsible for Finance and IT, said the first half was “one of the most challenging in the history of our company” due to the Covid-19 pandemic.
“At the same time, we introduced comprehensive measures aimed at reducing costs and ensuring liquidity from the beginning, which allowed us to limit the impact of the pandemic on our business to a certain extent,” Witter said in a statement Thursday.
“Due to the positive trend exhibited in our business in recent weeks and the introduction of numerous attractive models, we are cautiously optimistic for the second half of the year.”
Volkswagen shares have fallen 21.5% so far this year.
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