Volkswagen has reported one of its highest-ever quarterly group profits even as vehicle sales in its core VW brand declined. As Laura Frykberg reports, it's a sign that long-overdue cost cuts are materializing as the carmaker pushes to overcome its emissions scandal.
An acceleration of operating profit at Volkswagen. Up 40 percent to over $4.7 billion for the group overall. One of the German company's highest ever earnings in a quarter. SOUNDBITE (English) JAMES HUGHES, CHIEF MARKET ANALYST, GKFX, SAYING: "Yes the numbers look particularly good and particularly profitable but of course the key thing is maintaining that when more comes out around the scandal and they have to fork out more." The emissions cheating scandal has not only cost the company tens of billions of dollars... It's cost it, its reputation. Vehicle sales in the largest VW division slipped in the three months to March. Behind the scenes though - Volkswagen is turning a corner. Saying its profit rise is down to cutting costs and halting vehicle models which don't make money. SOUNDBITE (English) JAMES HUGHES, CHIEF MARKET ANALYST, GKFX, SAYING: "When you go through a scandal you have to have a change. The reputational damage is still there but it has obviously not been as hard hit as had been Volkswagen's expectations." Volkswagen's success is shared by its competitors. Daimler and BMW also reported better than expected results.