With automakers facing one challenge after another, Volkswagen, Europe’s biggest automaker reported sales down 0.8% to 532,400 units last month as demand dropped in its home market. Sales during the first quarter increased 5.2% to 1.43 million vehicles compared with the same period last year. First-quarter sales were up 7.3% in North America, 21% in Asia-Pacific region, with sales up 24% in China. India dropped 19% and South America 7.3%, thereby making markets o become more difficult, and in some cases decidedly more challenging.”
In Europe, VW’s sales during the first quarter fell 10%, as sales in Germany, its home market, dropped 15%. Analysts predict that the auto industry in Europe will fall for the sixth consecutive year, as the economic crisis continues to affect demand and consumers’ confidence.
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VW’s financial-services division said that the economic growth will remain ‘muted’ in the main industrial markets. VW expects earnings this year to be flat and they will probably match the 1.41 billion euro reported in 2012.
“Due to the rather weak economy we don’t expect significant interest rate increases in 2013. The persistent debt crisis will continue to cause insecurity and volatility on financial markets,” said Frank Witter, head of the financial-services division.
