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VW cuts bonuses

February 22, 2013

The chief executive of German carmaker Volkswagen and other managers have seen their bonuses cut by new regulations set up by the supervisory board. The move came despite rapidly boosted net profit in 2012.

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VW CEO Martin Winterkorn +++(c) dpa - Bildfunk+++
Image: picture-alliance/dpa

German carmaker Volkswagen announced on Friday it would cut executives' bonuses for last year despite the company logging record bottom-line profit in 2012.

VW's supervisory board said CEO Martin Winterkorn would receive 14.5 million euros ($19.2 million) in bonuses for his work throughout last year, down from 17.5 million in 2011.

All in all, Europe's biggest auto maker said it would pay its executives some 56 million euros on top of their salaries. Back in 2011, the company still shelled out 70 million euros in bonuses.

Unabated demand

The decision to cut bonuses came on the back of an outcry last year over what the public felt were unjustifiably high financial rewards for a couple of people at the helm of the firm, including CEO Winterkorn. The company stressed that it had nothing to do with VW's recent performance on global markets.

On the contrary, VW on Friday reported its net profit soared by 40.9 percent year-on-year to a record 21.7 billion euros. Revenues also rose by 20 percent, with deliveries up by 12.2 percent at well over nine million vehicles.

VW to Announce Record Profits

The group indicated it would raise its dividend to 3.50 euros per share, up from three euros a year earlier. The Wolfsburg-based firm said its outlook remained optimistic, expecting the carmaker to "outperform the market as a whole in a challenging environment."

hg/msh (AFP, Reuters)