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Profits at Porsche affected by the Volkswagen scandal

By Staff Reporter

German luxury carmaker Porsche has seen its profits cut by more than half as a result of its shareholding in Volkswagen, which is embroiled in a worldwide diesel emissions scandal.

Porsche, which owns just under a third of Volkswagen's shares, said its net profit slumped to €1.2bn (£848m) from €2.5bn (£1.8bn), due to costs the affair has rung up so far.

Porsche said its profits from investments in its fellow German carmaker were "negatively impacted" due to "expenses incurred at the level of the Volkswagen group in connection with the diesel emissions issue".

Last month Volkswagen admitted installing software designed to cheat diesel emissions tests in 11 million vehicles worldwide, including almost 1.2 million in the UK.

Volkswagen has launched an investigation and appointed a new chief executive and chairman. The carmaker is setting aside funds as it recalls cars and prepares to fight court cases against shareholders and customers. Porsche said full-year profit will range between €800m (£600m) and €1.8bn (£1.3bn).

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