VW second-quarter operating profit up 30% as SUV push pays off

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Volkswagen Group said its second-quarter operating profit rose 29.9% despite a 1.8% drop in vehicle sales after the VW brand launched a raft of higher-margin sports utility vehicles and amid rising sales at Porsche and Skoda.

The Wolfsburg, Germany-based company's operating profit rose to 5.13 billion euros ($5.71 billion), up from 3.94 billion euros in the second quarter last year. The operating profit jump was magnified by the absence of a diesel charge VW booked in the year-earlier period.

Volkswagen reiterated it expects vehicle deliveries in 2019 to exceed a prior-year figure and for revenues in the passenger cars and commercial vehicles divisions to grow at least 5%.

VW said it continues to expect an operating return on sales in the passenger cars area between 6.5% and 7.5% and reiterated that after special items, it expects the operating return on sales to be at the lower end of the expected range for the group and the passenger cars business area.

Peugeot on Wednesday said it had delivered an operating margin of 8.7% in the first half of 2019, without releasing a more detailed breakdown of quarterly results.

By contrast, Volkswagen Group's operating return on sales rose to 7.2% in the first half, up from 6.8% in the year-earlier period.