VW Profits Up 28 Percent for Third Quarter

October 30, 2008
Product and market diversity--that's the name of the game for one of the world's largest automakers. That savvy strategy is giving VW solid profit growth even in the midst of troubled times. It was sales in emerging markets like China, Russia, and India, reports Detroit News, that helped the automaker from Wolfsburg claim net profit increases of 28 percent compared its third-quarter performance of last year.

Even as sales in the U.S. and Europe slacken, VW's ability to grow in a tough world market shows the strength of its diverse product portfolio. Not only do its sporty, efficient entries (such as the 2009 VW Jetta TDI) stand to do well in the cash-strapped U.S. market, but the company's increasing stronghold in developing nations with low-priced models produced sometimes in modernized factories (under brands like SEAT and Skoda) ensure that it will come out of this global downturn ahead.

It's no wonder that specialty sportscar maker Porsche wants in on VW's success. Indeed, despite resistance from the German state of Lower Saxony, Porsche will reach a 75 percent stake in Volkswagen AG sometime next year, allowing it to enforce a "Domination Agreement" at that point enabling it to list VW's assets and revenues on its own balance sheets.--Colin Mathews

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