http://www.detnews.com/2004/au...3.htmFRANKFURT, Germany -- German automaker Volkswagen said Wednesday its profit fell by 57 percent in 2003 amid price wars in North America and a stronger euro that cut export earnings.
Net profit fell to 1.1 billion euros ($1.4 billion) from 2.6 billion euros the previous year, the company said, with sales increasing a slim 0.2 percent to 87.1 billion euros ($112.4 billion).
However, the profit performance exceeded the forecasts of analysts surveyed by Dow Jones Newswires, who on average expected earnings of 978 million euros ($1.26 billion).
As expected, the Wolfsburg-based company said it was cutting its dividend to 1.05 euros ($1.35) per share from 1.30 euros in 2002.
Volkswagen has faced rough conditions in the North American market, where it has been reluctant to match fierce price-cutting from rivals General Motors Corp., Ford Motor Co. and DaimlerChrysler AG’s Chrysler division.
Additionally, the euro’s rise to record highs against the U.S. dollar has put pressure on profit margins and shrinks the value of U.S. revenues when they are translated back to euros for earnings purposes.
The company’s statement did not include figures for the fourth quarter of 2003.
I say it has to more with lower quality and p1ss poor service than price wars in North America and a stronger euro that cut export earnings :crazy: