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Volkswagen posts quarterly profit despite drop in sales

Volkswagen returned to profit in the third quarter as surging Chinese demand for luxury cars helped offset a 1.1% drop in vehicle deliveries due to the pandemic, sending its shares as much as 3% higher on Thursday. The German automaker's return to the black comes amid spiking coronavirus cases in Europe that led governments in France and Germany to order their countries back into strict national lockdowns on Wednesday. "The coronavirus remains a central problem," Volkswagen Chief Financial Officer Frank Witter said in a conference call with reporters. "This situation now is anything but relaxed." But Witter said the group expected the economic recovery to continue and did "not anticipate any nationwide lockdowns in larger markets." Witter said the takeover of U.S. truck maker Navistar International by Volkswagen's trucking unit Traton was an important acquisition, but the "current economic climate will not make this easy." Volkswagen reiterated it expects to post a profit for the full year, saying its business "recovered noticeably" in the third quarter as sales in China of premium vehicles, including Audi and Porsche sports cars, rose 3%. The quarterly performance was also aided by a series of cost-cutting measures launched earlier this year. Volkswagen said its net liquidity rose to 24.8 billion euros from 18.7 billion at the end of the second quarter. Excluding one-time items, third-quarter operating profit was 3.2 billion euros ($3.8 billion), down from 4.8 billion euros a year earlier, but up from a second quarter loss of 1.7 billion. In a note to clients, Jefferies analyst Philippe Houchois described the results as a "solid performance with strong cash, but relatively muted in the context of the (auto) sector recovery." Last week, German rival Daimler reported a record 24% jump in Chinese demand for its Mercedes-Benz cars, boosting its margins in the third quarter. Italian-American Fiat Chrysler Automobiles and Peugeot manufacturer PSA Group both also posted solid results this week. Witter said Volkswagen could not say for sure whether it would meet EU CO2 emissions targets this year, adding "it will be a tough race." At 1030 GMT, Volkswagen shares were up 2.9% at 129.20 euros. Related Video: Earnings/Financials Audi Bentley Bugatti Lamborghini Porsche Volkswagen

2018 Audi Q8 tears up the Nurburgring

Audi took to the Nurburgring to test the upcoming Q8, showing off the attractive yet minimalist shape we've seen on the international auto-show circuit this year. One thing that's not understated: the massive grille that's blacked-out in these spy shots. We expect the 2018 Q8 to go on sale about a year from now. The coupe-like styling belies a roomy SUV, one that has space in back and is expected to seat five comfortably. Using Volkswagen Group's MLB platform, the Q8 would slot in as the sportier counterpart to the Q7, which seats seven and has a more traditional design. The Q8 will take aim at the Mercedes GLE Coupe, BMW X6, Maserati Levante, and others. So what will be under the hood? Some rumors suggest the Q8 RS version will get the same twin-turbo V8 engine as the Lamborghini Urus (a VW Group sibling). The concept at the Detroit Auto Show was a high-powered turbocharged plug-in hybrid, while the Geneva concept, called the Q8 Sport, used an electric supercharger to augment its hybrid powertrain. The vehicle on the 'Ring looks near-production-ready with the roofline a little less dramatically chopped than the concepts. The strong lines and creases continue, however, and the Q8 is poised to be a head-turner when it arrives in production trim. Related Video: Featured Gallery 2018 Audi Q8 Spy Shots View 10 Photos Spy Photos Audi Crossover SUV

Audi and Mercedes both outsell BMW in January

There won't be any celebrations in Munich this month, as BMW was outsold by arch-nemeses Audi and Mercedes-Benz. The Bavarian company finished behind Audi in January, which took the top spot for the first time since June of last year, Bloomberg reports. Ingolstadt rode high on a 10-percent bump in sales, while Mercedes saw a larger 14 percent increase. BMW, meanwhile, only saw a modest 6.3-percent sales increase last month, thanks in large part to its struggles in China. The company's sales there increased at about half the rate of its chief competitors, with a 7.9-percent jump to Mercedes and Audi's roughly 15-percent increases. Perhaps more worrying for BMW, though, is that this could become something of a trend for the company. According to Bloomberg, issues with Chinese dealers who cancelled orders over sales targets and bonuses combined with what the publication calls aging models, could spell bad news for the German marque. "This looks like a pretty significant decline in growth compared to Mercedes and Audi," Bankhaus Metzler analyst Juergen Pieper told Bloomberg. "I think this will continue during the next few months." News Source: BloombergImage Credit: Matthias Schrader / AP Earnings/Financials Audi BMW Mercedes-Benz