India, April 10 -- Volkswagen's first-quarter profits fell as much as 40 per cent due to penalties of missing European Union (EU) carbon emissions targets and also because of US tariffs.

As a result, the operating profit for the period was €2.8 billion, which is down from €4.6 billion a year back, and "significantly" below market expectations, according to a Bloomberg report.

The tariff impact came about since the bulk of the brand's US sales is cars made in Mexico, with its Audi and Porsche brands also having no US manufacturing bases.

However, there is some positive news for both these factors.

When it comes to the emission standards in Europe, the European Commission has now proposed to loosen the rules which most of th...