Volkswagen Group Sales Slump on Poor Chinese Market

New car sales of all brands totalled 740,000, with 5.7% more cars delivered to customers in August than in the same month last year, which was also weak.

In July, the annual increase was 6.6% and in the first half of the year as much as 12.8%.

The lower figures are mainly due to the car giant’s declining sales in China, where it sold 278,000 vehicles in August, down an annual 6.5%.

The group justified this with an unusually strong month in the previous year, when China boosted car sales with tax benefits.

However, most other regions were in the black. The VW Group made significant gains in Western Europe, where 232,000 vehicles were delivered, which is 21.1% more than a year ago.

Of the individual Group brands, the main growth drivers included Audi, which rose by 14%, while Skoda sales increased by 19% and SEAT/Cupra jumped by 54%.

By contrast, the core brand Volkswagen, which accounts for more than half of Group sales, recorded a drop of 1.7%. Porsche was also down 1.5%.

VW is currently struggling with the declining demand for e-cars and a lack of engine parts for combustion engines after the August floods in Slovenia forced production cuts at several plants.

VW brand chief executive Thomas Schäfer, however, described the current reluctance to buy at the beginning of the month as only an “interim low.”

At the end of July, Volkswagen Group chief executive Oliver Blume already cut the sales target for the whole year. Instead of the previously targeted 9.5 million vehicles, he now only expects 9 million to 9.5 million deliveries across the Group by the end of the year.