But will quarter four be as good?
Covid-19 has hit many industries very hard around the world, for instance the airline and hospitality industry, but some industries are not really feeling the pinch of Covid-19 and this might be due to high profit margins to start with and huge financial reserves from previous years of high profit taking. We could be wrong, but financial figures are in from some of the biggest European car manufacturers and also one big American car manufacturer and it all looks rather rosy for now and the future.
The Volkswagen Group (VW) has just reported that they have delivered 2.6m vehicles. This was just 1.1 per cent fewer than in the same period last year. Although total sales in 2020 so far have fallen by more than a fifth.
After posting a loss of €1.4bn for the first six months of the year in the wake of factory closures and widespread lockdowns, the group reported pre-tax profits of €3.6bn for the three months to the end of September.
Pre-tax earnings were €2.3bn for the first nine months of the year, down from €14.6bn for the same period last year.
VW said that while it expected annual earnings to be “severely lower” than last year, the improving global market meant it would achieve an operating profit despite the resurgence of Covid-19 and new restrictions in France and Germany.
Volkswagen rival Daimler has already reported that its net profits increased nearly a fifth in the third quarter to almost €2.2bn, thanks to a strong rebound in sales of its Mercedes-Benz brand in China.
German premium brand BMW, which is due to report quarterly figures next week, said it had more than €3bn in free cash flow in the period, vastly exceeding market expectations, thanks to “a faster recovery in several markets”.
On Wednesday, US carmaker Ford announced its third-quarter profits had almost doubled compared with 2019, achieving USD3.6bn in earnings before interest and taxes, thanks in part to rising demand.
So, its good news for auto manufacturers in Germany and America and wait for the Korean, French, Italian and Japanese car manufacturers to share their sales figures to see if this is a global trend or is it just the vast economic gains that Europe and America already has that is keeping auto sales moving.
Meanwhile, China is seeing positive growth in all segments and their auto manufacturers like Geely are all seeing rising profits as the Chinese economy bounces back stronger than ever and with electric vehicle sales taking a dominant sales lead with all big brands.
