BERLIN — Volkswagen Group reported third-quarter earnings of 4.3 billion euros ($4.29 billion), behind pre-pandemic levels, following 1.6 billion euros ($1.6 billion) in one-off charges from the suspension of Russian activities and its Porsche listing.
The automaker cut its vehicle sales expectations for the year as chip availability remains scarce and logistics continue to pose a challenge
VW said it expected deliveries to be around the same as last year, after reporting earlier this month that they were down 13 percent in the first nine months. In May it had predicted a 5 percent to 10 percent rise.
“As a result of the structural undersupply of semiconductors, the 2022 financial year will continue to be burdened by supply bottlenecks,” VW said in the statement on Friday. “We expect the supply of semiconductors to improve further in the fourth quarter.”
The results beat last year’s third quarter when chip shortages reduced sales across the auto industry, but they lagged behind pre-pandemic profits as the automaker grapples with supply chain bottlenecks and high costs.
VW maintained its outlook for the year of hitting the upper end of a 7 percent to 8.5 percent earnings margin, compared with its third-quarter margin of 6 percent, given a strong recovery in the Chinese market and an easing of semiconductor supply.
As the economic outlook darkens, VW joined Ford in a surprise decision this week to cease all activities with U.S. driverless vehicle company Argo AI following multi-billion investments by both partners.
The decision will result in a 1.9 billion euros non-cash impairment charge, VW said Friday.
VW warned of increasing competitive pressure, indicating unusually high vehicle prices might be slipping.
Automakers have navigated the chip crisis by both swinging production to their most lucrative models and raising prices as vehicle availability dwindled.
Meanwhile, VW said it continues to struggle to keep up with strong demand for full-electric cars with a high order bank in Europe of 350,000 vehicles.
Automakers are emerging from a period of setbacks dominated by crippling supply-chain woes to contend with a weakening economy. For now, the picture remains uneven with manufacturers working down full order books after months of disrupted production.
But with recession fears mounting, consumer demand has started to slow. Ford Motor earlier this week trimmed its profit forecast for the year because of shortages and higher payments to suppliers.
Reuters and Bloomberg contributed to this report