UPDATE 2-Volkswagen makes slow progress in cutting costs

jueves 12 de marzo de 2015 10:11 GYT

* VW has identified half of planned 5 bln eur cost cuts

* VW 2014 brand operating profit down 14 pct

* VW shares down 0.6 percent (Adds CFO, trucks chief comments, detail, updates shares)

By Andreas Cremer

BERLIN, March 12 (Reuters) - Volkswagen is making slow progress in cutting costs at its core passenger car brand, where profit continued to fall last year due to weaker emerging markets and technology costs.

Europe's largest automaker is aiming for 5 billion euros ($5.3 billion) of savings a year at its namesake VW brand by 2017 to close a profitability gap with rivals such as Toyota.

Group Chief Executive Martin Winterkorn said on Thursday cost cutting, including ceasing unprofitable models and reducing expensive equipment, might boost the brand's 2015 results by "well over 1 billion" euros.

That's only about a fifth of the target, and added to some analysts' doubts about the plan, even though works council chief Bernd Osterloh told Reuters in January that VW should manage savings of "substantially more" than 5 billion.

"Scepticism about such cost-cut plans is justified," said Bankhaus Metzler analyst Juergen Pieper, who recently lowered his recommendation on VW stock from buy to hold. "I expect the savings to be smaller (than the targeted 1 billion this year); ultimately it's very difficult to verify the savings."   Continuación...