Recently, Volkswagen Group revised its profit margin forecast for 2023, attributing it to the rise in raw material costs at the end of the third quarter and hedging losses resulting from supply chain issues.
Like many other industrial enterprises, automakers typically hedge against price fluctuations of bulk commodities at the end of each quarter, which may result in non-cash gains or losses.
As Europe's largest car manufacturer, Volkswagen stated in an announcement that hedging of raw materials at the end of the third quarter led to a non-cash loss of 2.5 billion euros, which will not be offset by the end of the year. As a result, Volkswagen anticipates a sales return rate of 7.0% to 7.3% this year, lower than the previously forecasted 7.5% to 8.5%. However, Volkswagen expects this year's operating profit excluding special items to remain on par with the same period last year, amounting to 22.5 billion euros.
Bernstein analysts commented, "This might be better than what some investors feared, potentially marking a temporary end to the negative sentiment towards the company."
Furthermore, Volkswagen retained its annual delivery and sales forecasts, still predicting deliveries of 9 to 9.5 million vehicles to customers this year, with a projected sales increase of 10% to 15%.
While Volkswagen's passenger car sales increased in the third quarter, production was reduced due to flooding in Slovenia affecting a parts supplier.
Volkswagen will release its complete third-quarter financial data on October 26th local time. Preliminary data indicates that the company's third-quarter sales grew by 12% year-over-year, reaching 78.8 billion euros, and operating profit increased by approximately 14%, amounting to 4.9 billion euros.
