BERLIN -- Global deliveries at Volkswagen AG’s namesake passenger-car brand dropped in October as Europe’s largest automaker struggled to contain the fallout from a cascade of emissions-manipulation revelations.
Deliveries fell 5.3 percent to 490,000 vehicles last month and dropped 4.7 percent to 4.84 million cars in the January-to-October period, the company said in a statement Friday. Sales gains lagged market growth substantially in China, where VW sells nearly half of its cars and light trucks.
VW is “experiencing challenging times” beyond the emissions manipulation due to “tense situations on world markets,” brand sales chief Juergen Stackmann said in the statement. He also cited shrinking demand in Brazil and Russia.
The automaker set aside 6.7 billion euros in the third quarter to recall about 11 million diesel cars with rigged engines but has already acknowledged the funds won’t be enough. Separately, it identified 800,000 cars with incorrect CO2 labels, a potentially even more expensive issue to fix because CO2 is the basis for taxation and emissions regulation in Europe. VW estimated the economic risk of the CO2 irregularities at 2 billion euros.
VW’s order intake in Germany is rising, but the brand faces declines in southern Europe, the U.K. and some markets overseas, VW brand chief Herbert Diess told German newswire DPA in an interview published earlier Friday.
Diess also told the news service he sees no evidence of further misconduct at the carmaker beyond the manipulations of diesel emissions tests and carbon dioxide certifications.
Diess told DPA he saw no threat of job cuts for the company's permanent staff. VW is pondering a reduction of temporary workers to help contain costs from the scandal, sources at VW have said.
Works council chief Bernd Osterloh, in the joint interview with Diess with DPA, said however that bonus payments to workers would not be at last year's level.
U.S. law firm Jones Day is conducting an independent inquiry at VW into the emissions test cheating, and VW on Thursday pledged to speed up a program to encourage staff to cooperate in the investigations.
Osterloh said he did not know whether the violations and manipulation of emissions tests committed by the company involved 10, 50 or even 100 people. "No one can tell that today," he said. "But even if I take 100 out of (a global workforce of) 600,000, it remains a limited group."
VW's top management and labor representatives are in talks to balance spending cuts and future investments as they brace for a bill expected to run into billions of dollars in fines, lawsuits and vehicle repair costs.
Worldwide deliveries for the entire Volkswagen group decreased 3.5 percent to 831,300 vehicles in October, edging 1.7 percent lower to 8.26 million vehicles in the first 10 months of the year. Although VW outsold Toyota Motor Co. in the first half, the Japanese auto giant will probably take the global industry crown for the full year, according to Steve Man, a Hong Kong-based analyst for Bloomberg Intelligence.
Separately, VW said it put bond financing on hold as it grapples with uncertainty over the ultimate cost of the emissions cheating scandal. The company needs time to update the documentation required to sell bonds and other financing instruments to reflect potential fines and penalties.
Bloomberg and Reuters contributed to this report.