VW Profit Lead Over Toyota Threatened Due To European Crisis

Volkswagen Group CEO Martin Winterkorn can check one thing off his to-do list: beat rivals in profit.

VW aims to become the world's biggest carmaker and a leader in profitability by 2018. The automaker reported record operating income of 11.5 billion euros ($15 billion) for 2012. That surpassed General Motor Co.'s $7.9 billion and Toyota Motor Corp.'s 1.06 trillion yen ($11.1 billion) for the year.

When Winterkorn set the growth targets in 2007, VW didn't look much like a world-beater. It had just gone through a disruptive round of job cuts, its namesake brand was barely breaking even, and Toyota earned about $10 billion more than VW.

Winterkorn vowed to raise pretax profit margins to 8 percent from just 1.7 percent in 2006. And he said VW would boost deliveries to more than 10 million vehicles from 6.2 million in 2007 -- in effect adding the sales of a carmaker almost as big as Hyundai Motor Co.

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lexworld - 3/18/2013 3:32:10 PM

0 Boost

You have to keep in mind the European's are kinda like the American Auto Makers in that they put so much emphasis on that false sense of security. I read the article, and the difference isnt that much. However the quality of the avg Toyota is significant and I would suppose that is where Toyota Execs and Engineers know they do and will continue to dominate the market with quality and refinement vs sales and profit. In the end, which is typical of the industries annual reports Auto Makers report, the result keeps coming up with Toyota on top becaus of their ability to capitolize on all fronts. Except for maybe Toyota's typical dealership experience, which doesnt seem to affect new customers and loyal customer base consistency. Between the 2 Giants, TMC is the one to really watch as Technology increases.

USNA1999 - 3/18/2013 7:22:49 PM

+1 Boost

Agree but I still take a VW or Honda over a Toyota anytime but I would prefer a Lexus (top range model ie. GS, LS) over the competition due to value. Like I stated in the other thread, TM and Lexus worldwide sales numbers are skewed since in many parts of the world like here in Beijing and some parts of South America and Europe Lexus cars are sold as Toyotas (ie. the GS, GX, LX). They love Audis here.

HughJass - 3/19/2013 5:22:38 AM

0 Boost

12 brands vs 2.5? If VW had just purchased a few more brands, they would've been #1 sooner. Is VW including Ducati in its sales?