On Monday, April 27, 2020, Volkswagen AG (VW) at the production headquarters in Wolfsburg, Germany, a car line worker wears a protective face mask. Volkswagen resumes production at its largest car plant in Wolfsburg. Labor leaders warn that political outbursts from a coronavirus pandemic could be more harmful than disruption of production.
Volkswagen reported an operating loss of 800 million euros ($ 940 million) in the first half of 2020 and reduced its dividend when the coronavirus pandemic killed car sales.
This compares with a profit of 10 billion euros for the same period last year. Group sales fell 23.2%, while deliveries fell 27.4% year on year, with the percentage gap to last year steadily declining since May, as shutdowns around the world caused demand for the crater.
At its annual general meeting in September, the German automaker will now offer a dividend per ordinary share for fiscal year 2019 of 4.80 euros, down from the previously announced 6.50 euros.
Although she warned that “challenges will also arise, in part due to increasing competition, volatile commodity and currency markets and tougher emission requirements,” Volkswagen said it still expects profits throughout the year.
Frank Witter, the group’s board member in charge of finance and IT, said the first half of the year was “one of the most difficult in our company’s history” due to the Covid-19 pandemic.
“At the same time, we have implemented comprehensive measures to reduce costs and provide liquidity in the early stages, which has allowed us to limit the impact of the pandemic on our business in some way,” Witter said in a statement on Thursday.
“Because of the positive trend in our business over the past few weeks and the presentation of many attractive models, we look cautiously optimistic about the second half of the year.”
Volkswagen shares have fallen 21.5% to date.