Vehicle History Expert Cartell.ie is looking at manufacturer profit. As we approach the end of Q3 we’re considering recently published results for Q2 2015 to give the run-down on which manufacturers are making money globally and which are still in the red as the world exits recession. Let’s start with the good news first. Ford motor company has recently announced its highest profit in 15 years. Furthermore, its Q2 result represented its highest ever North American profit in a single quarter. Interestingly it managed the feat without overly relying on its F150 pick-up truck, which didn’t reach full production until early June, and which has been long flagged as a saviour for the company due to its construction methods and expected margin of possibly $13k per unit.  Globally Ford reduced its losses in South America to $185 million and posted a $14 million loss in Europe. Overall, though, things look good for the blue oval at the moment.

Operating profit at Europe’s largest carmaker VW rose to €3.49 billion in Q2 2015. The automaker on everyone’s lips at the moment based the results on a European recovery and cost cutting measures but it lowered its sales guidance as demand in China slowed. Unfortunately, this is old news now: VW has recently been engulfed in an emissions regulatory scandal which has wiped billions off its share price and shows no immediate sign of abating:  news today says that upwards of 2 million Audi models are now affected alongside the millions of VW models announced last week. CNBC quoted one industry observer:

My biggest fear is that the amount of money we are talking about, the 6.5 billion euros ($7.3 billion) that has provisioned for, is a smaller amount than Volkswagen will probably have to pay,” Juergen Pieper, head of automotive research at Bankhaus Metzler, told CNBC’s “Squawk Box Europe” on Monday. My second concern is the duration of this scandal – it will probably take years before it sorts out all this and there’s the reputational damage too,” he added.

BMW reported group net profit of €1.75 billion down from €1.77 billion year-on-year which was attributed to higher personnel costs, increased expenditure on new product start-ups and a change in the model mix as well as a slow-down in China. The company said it still expects new records for sales and pretax profit in the full year even though earnings momentum was slowing.

Toyota sold less cars at the end of Q2 year-on-year – it was actually down 127,285 – but managed to make more money. The company posted record profit in Q2 which was attributed to favorable foreign exchange rates and cost reduction efforts. Toyota also revised its global sales forecast upward to 8.95 million vehicles, compared to 8.9 million previously.

GM announced in September it had settled certain civil actions against the company related to 2014 product recalls, including the ignition switch recall. While it was considered exposed to the slow-down in China (the region is the largest sales market for GM) the company posted a stronger than expected Q2 earnings of $1.1 billion, with profit boosts coming from North America and China. The automaker, driven by truck and SUV sales and growing average sales prices, set a record for its North American adjusted earnings and profit margin for any quarter since emerging from bankruptcy as a new company in 2009.

Another company which is turning the corner is Group Renault who announced a Group operating profit of €1.07 billion at the end of Q2 -an increase of 47%.  Hyundai saw its profits plunge 23.8% year-on-year at the end of Q2 attributed to a strong won and increased competition at home and abroad. Still, Hyundai made lots of money: its net profit came to $1.55 billion during the April-June period, down from 2.35 trillion won a year earlier, but still healthy none-the-less.

It was a similar story over at Nissan who announced its operating profit rose 58 percent to 193.71 billion yen in the quarter, and stated it sold 1.29 million vehicles during the period, with the increase topping the market average. French group PSA Peugeot Citroen swung back into profit after three years of losses citing cost cuts. Germany’s Daimler saw net profit rise by 8% to €2.4 billion. Japanese automaker Honda posted a 20% increase in global profit for the quarter ended June 30, as the weak yen and the strong U.S. market bolstered its bottom line.

Honda recorded a $1.52 billion profit for the period, its fiscal first quarter. Honda has taken a hit from costs associated with the supplier Takata’s airbag crisis. Fiat also reported a profit when it posted second-quarter earnings of €333 million largely thanks to strong growth in North America.

Conclusion

Overall the outlook, based on these Q2 results, is clearly positive across the industry with many companies in a stronger position than last year. However, the dark cloud on the horizon is the VW emissions scandal and its fallout. While the industry has been aware of differences in values between claimed values and “real-world” numbers few could have expected the matter to come to head in such spectacular fashion. The Q3 results across the board will be interesting but particularly in the case of VW to see if they have a handle on the estimated costs of getting to grips with the issue.