VW Sales Get A Boost From China
February 13 2016 - 2:02AM
Dow Jones News
(FROM THE WALL STREET JOURNAL 2/13/16)
By William Boston and Monica Houston-Waesch
Volkswagen AG's global car sales returned to growth in January
on the back of resurgent demand in China that offset declines in
its namesake brand in other markets.
January's sales report shows that Volkswagen's market-leading
position in China and continued gains by its premium brands Porsche
and Audi are helping it cope with the erosion of its namesake brand
in hard-hit emerging markets and the impact of its
emissions-cheating scandal on sales in the U.S. and Europe.
Its sales grew strongest in China, rising 14%, while sales in
Russia and Brazil, struggling with declining economies and volatile
currencies, fell 30% and 39%, respectively. Volkswagen's sales in
the U.S. declined 7% and were up about 3% in Western Europe.
Economic weakness in Russia and Brazil are hurting other auto
makers, including France's Renault SA, which on Friday warned it
would need a bailout for its Russian operation or the unit could
face bankruptcy. It confronts a deepening crisis at OAO AvtoVAZ,
the Russian car maker it controls with Japanese partner Nissan
Motor Co.
Renault said it is discussing a cash injection with other
shareholders in AvtoVAZ that could include a debt-for-equity swap.
AvtoVAZ reported a net loss for 2015 of 73.8 billion rubles ($928
million) as sales of its Lada sedans fell 31%. The Russian car
maker said without aid it could face doubt about its ability to
continue as a going concern.
Volkswagen CEO Matthias Muller said in a statement, "The
situation in Brazil and Russia remains tense, China is regaining
momentum and the trend in Europe is generally stable." The
company's overall sales last month rose 3.7% to 847,800 cars,
trucks and motorcycles.
Hardest-hit by the emissions crisis is Volkswagen's namesake
brand -- Volkswagen Passenger Cars -- by far its biggest business
by sales. Brand sales rose 2.8% to 521,400 vehicles in January, but
all of the growth came from Asia, especially China. Volkswagen
brand sales declined in every other market.
---
Inti Landauro and James Marson contributed to this article.
(END) Dow Jones Newswires
February 13, 2016 02:47 ET (07:47 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.