VW in record sales despite diesel-cheat crisis

Volkswagen Group’s global sales jumped 3.8 percent last year as higher demand in China and Europe offset drops in the U.S. and South America. VW sales are proving resilient despite the diesel emissions scandal which has plunged the company into crisis since it came to light in September 2015.

Full-year deliveries at the 12-group brand, including its Audi and Porsche luxury marques, rose to a record 10.3 million, the automaker said. That figure should put VW ahead of Toyota as the world’s largest car producer by volume.

VW CEO Matthias Mueller said in the statement that the automaker had stabilized its business in a “very challenging year.” He noted that the group is on track for a successful 2017 with its brands launching 60 new or refreshed vehicles, including core models such as the new VW Polo and Touareg, Skoda Yeti, Seat Ibiza, Porsche Cayenne, Audi A8 and Bentley Continental GT.

Group sales rose 12% in China last year and 4% in Europe. Brazil sales fell 34 % while U.S. volume dropped 2.6 percent.

Among group car brands Skoda’s volume rose most in 2016 with a 6.8% increase. Others that recorded growth include Porsche 5.6% Audi 3.8%, VW brand’s volume 2.8% and Seat’s sales increased 2.6%. Sales of VW commercial vehicles rose by 11%, helped by a strong European LCV market.

Skoda said its 2016 sales were lifted by rising demand in Europe and China and it expects the launch of its new Kodiaq SUV and an upgrade to its Octavia model to bolster its first half. Both models will provide “further positive momentum” for the brand, Skoda CEO Bernhard Maier said in a statement.

Seat said it had its best unit sales result since 2007, boosted by the introduction of its first SUV, the Ateca and higher demand for its best-selling model, the Leon, whose sales rose by 3% and its Alhambra, whose sales jumped 14%, giving both models their highest ever sales results.

Luca de Meo, Seat CEO said the brand aims to increase volume again this year with the launches of an updated Leon, the fifth-generation Ibiza and the new Arona small SUV.

Toyota said last month, it expected to end 2016 with sales of 10.09 million vehicles, slightly below an initial forecast of 10.11 million. The automaker, which has topped delivery rankings for the past four years but trailed VW at mid-year, is expected to report its 2016 deliveries in early February.

NordLB analyst Frank Schwope expects VW will be the world top carmaker this year but said the gap with rivals may shrink as demand in China, which accounts for nearly 40% of VW group sales, may weaken because of plans to reduce or phase out tax breaks for small engine cars.