Volkswagen Group’s after-tax profit rebounded strongly to 3.4 billion euros ($4.1 billion) in the first three months of the year as sales rebounded in China, the company’s largest single market, and as customers went for the more profitable models in the company’s lineup. Sales of electrified cars more than doubled.
The first-quarter profit figure improved from 517 million euros in the same period of 2020, when the pandemic caused dealerships and factories to close.
Sales revenues in the first quarter of 2021 rose by 13% to 62.3 billion euros, boosted by a strong rebound of 61.4 percent in unit sales as China reopened after being hard-hit by the pandemic in the first quarter of 2020.
The Wolfsburg, Germany-based group raised its outlook for profitability for the year, saying operating returns on sales would reach 5.5% to 7.0%. The company said it expected sales to customers would be “significantly up” from the previous year, assuming successful containment of the COVID-19 pandemic.
The company said Thursday its cash position improved to 29.6 billion euros, money it can use to invest in new technologies and drive its push into electric vehicles and transportation-related services. Sales of electric cars, both battery-only and battery-internal combustion hybrids, more than doubled in the first three months over the previous year period, to 133,000 vehicles. Overall, Volkswagen sold 2.4 million vehicles in the quarter, up 21%.
In addition to its namesake brand, Volkswagen Group includes luxury automakers Porsche and Audi, as well as SEAT and Skoda.