* VW cut fixed costs in Germany by 300 mln eur in 2016
* Cost-cutting efforts are paying off -brand CEO
* Detailed brand results due on March 14
(Adds detail on 2016 cost savings and background)
GENEVA, March 7 Volkswagen's core
brand will improve profitability and gain market share this year
after posting stable operating results in 2016 thanks to cost
cuts, brand chief executive Herbert Diess said.
The namesake brand, the group's largest by sales, is cutting
thousands of jobs via natural attrition, streamlining
development processes and reducing the number of parts to revive
profitability which has been lagging rivals such as Toyota
and PSA Group.
The Volkswagen (VW) brand last year cut fixed costs by about
300 million euros ($320 million) in Germany alone, destination
of over 9 percent of global deliveries of 6 million cars, Diess
said at a press conference on Monday at the Geneva auto show.
"Our work is already paying off. We have put ourselves in an
excellent starting position for 2017," said Diess, who was known
as a cost-cutter at BMW before he joined VW in 2015.
Despite progress on cost cuts, brand management and the
carmaker's unions have been struggling to implement a
cost-cutting plan dubbed future pact, designed to lift
profitability. The brand accounts for nearly half of group sales
but no more than 11 percent of its underlying earnings.
VW group swung back to record operating profit before
special items last year, powered by record deliveries of
high-margin Audi and Porsche models. Detailed results for its 12
brands are due for publication on March 14.
($1 = 0.9459 euros)
(Reporting by Andreas Cremer; Editing by Victoria Bryan/Ruth