Volkswagen Financial Services revenue grew 6.4% year-on-year to €27.6bn (£24.2bn), as the captive financial arm continued to make a positive contribution to the German manufacturing group.

Operating profit also grew in the period, increasing 9.6% on 2015’s figure to €2.1bn.

Overall the Group recorded a positive year after the diesel scandal damaged its reputation and bottom line in 2015, with Matthias Müller describing the results as showing VW had got ‘back on track’.

Total vehicle sales increased 3.8% globally from 2015 to 2016 to 10.4m, while sales revenue increased 1.9% to 217bn in the same period.

This meant that even before the money set aside and costs related to the diesel and other special items were taken into account, operating profit increased 14% year-on-year to €14.6bn.

These special item costs more than halved to €7.5bn, meaning once these were taken in to account, VW’s actual operating profit was €7.1bn – compared with a €4bn loss the year before.

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By GlobalData

In 2016 the Group launched its ‘Together – Strategy 2025’ plan. According to Müller, this has progressed since its launch. He said: “The transformation of the core automotive business is on track, the new mobility services business unit is taking shape, our traditionally high innovative strength has been given yet another solid boost and financially, we have the realignment process well under control."

Looking ahead, the Group noted: “2017 will moderately exceed the prior-year volume amid persistently challenging market conditions. Challenges will arise particularly from the economic situation, intense competition in the market, volatile exchange rates and the diesel issue. The sales revenues of the Volkswagen Group is expected to grow by up to 4 percent year-on-year in 2017. In terms of the Group's operating result, Volkswagen anticipates an operating return on sales of between 6.0 and 7.0%.”