VW Group profit falls on restructuring charges, lower deliveries

Volkswagen Group reported a 2.4 percent drop in second-quarter operating profit as the automaker continues to cut costs and revamp its model range.

EBIT was €5.46 billion ($5.91 billion) in the April-June period, the company said on Aug. 1.

Operating returns fell to 6.6 percent, down from 7 percent a year earlier. At the company's so-called core group, which consists of the VW, Skoda and Seat brands, profitability dropped to 5 percent.

The result "is below our ambitions and potential, given our array of great vehicles, our brand portfolio and our global footprint," CFO Arno Antlitz said.

"We must make significant efforts on the cost side in the second half and beyond in order to achieve our targets," Antlitz added in a statement.

VW Group is banking on a record number of model launches during the second half to reach its targets. The company's namesake brand also continues to work through a deep cost-cutting program to lift returns.

The group lowered its operating returns outlook in July to the 6.5 to 7.0 percent range because of higher expenses due to the possible closure of an Audi plant in Brussels and a 3.8 percent drop in second-quarter sales.

Order books were filled into the fourth quarter, VW said, but the automaker's finances were dragged down by factors including rising provisions for an ongoing severance program and higher fixed costs.

Reuters and Bloomberg contributed to this report