Volkswagen Group achieved profits of €11.3bn (£10.1bn) in the first nine months of 2016, a 10.5% (1.1bn) increase on the same period in 2015, before special items are accounted for.

In 2016, operating profit was hit by €2.6bn worth of special items caused by ‘the diesel issue’, meaning actual the profit was €8.6bn once these were deducted.

The ‘special item’ costs caused by the diesel issue were substantially higher in 2015, however, meaning this €8.6bn figure was substantially higher than the €3.3bn operating profit after special items Volkswagen recorded for the first nine months of 2015.

The group reported that the diesel issue also impacted on Q3 2016  earnings, with special items deducting €442m from operating profit.

Nevertheless, earnings for Q3 2016 were €544m higher than in 2015, and operating profit over €6.8bn higher, as Q3 2015 experienced €6.7bn in special items deductions.

Volkswagen reported after tax profits of €2.3bn for Q3 2016, compared with the loss of €1.7bn realised for the same period in 2015.

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Sales revenues showed little movement in the first nine months of 2016, decreasing slightly to €159.9bn from €160.3bn year on year.

Matthias Müller, chairman of the board of management of Volkswagen AG, said: “The figures for the first three quarters show the operational strength of the alliance of the brands in the Volkswagen Group.

“Despite major challenges and the negative impact of the diesel issue, the Volkswagen Group remains on a solid financial footing.”

By brand, Volkswagen passenger cars sales decreased by 100,000 year-on-year to 3.2m vehicles in the first nine months of 2016.

Bentley, Porsche, and Skoda all increased sales, with Bentley increasing 6.1%, though operating profit fell to €54m from €57m.

The group predicts that the full-year operating return on sales will be between 5 and 6%, with estimates nearing the upper end of the range.

Digital lab

Volkswagen Group opened a digital lab in Berlin earlier this week, as a drive towards IT, digitalisation, and autonomous driving.

The lab was funded by Volkswagen’s innovation fund, a joint venture with Germany’s General Works Council, and is designed to add to an existing network, to strengthen ‘in-house competence in the field of software solutions’.

Müller said: “We are harnessing the opportunities offered by digitalisation and will be thrilling our customers with tailored smart mobility solutions.”