A Volkswagen emblem behind an ID.7 electrical automobile on the Volkswagen electrical automobile manufacturing facility on February 24, 2026 in Emden, Germany.
Focke Strangmann | Getty Pictures Information | Getty Pictures
German auto big Volkswagen on Thursday warned of additional price discount measures after reporting weaker-than-expected first-quarter revenue, citing larger U.S. tariffs and intensifying competitors from Chinese language automobile manufacturers.
Europe’s largest carmaker posted working revenue of two.5 billion euros ($2.92 billion) for the primary three months of the 12 months, down 14.3% from a 12 months in the past and lacking analyst expectations of practically 4 billion euros, in keeping with an LSEG-compiled consensus.
Gross sales income got here in at 75.66 billion euros, down 2.5% from the identical interval in 2025. Analysts had anticipated this determine to come back in at 75.45 billion euros.
“Wars, geopolitical tensions, commerce limitations, stricter rules, and intense competitors are creating headwinds. On this difficult atmosphere, we have now managed to make tangible progress,” Volkswagen CEO Oliver Blume mentioned in an announcement.
Shares of Volkswagen have been up round 1.1% on Thursday, erasing losses after notching a recent 52-week low earlier within the session. The inventory has fallen greater than 17% year-to-date.
The outcomes come as prime European authentic gear producers (OEMs) navigate a number of trade challenges, from commerce uncertainties and excessive manufacturing prices to electrical automobile adoption constraints and regulatory stress.
The continuing Center East disaster can be threatening to hamper demand for luxurious automobiles, with Volkswagen’s Blume warning final month that the Iran struggle might damage gross sales of its Porsche and Audi manufacturers.
Volkswagen is at the moment implementing sweeping job cuts and a significant product offensive because it seeks to spice up profitability amid intense competitors from Chinese language automobile corporations. Round 50,000 jobs are anticipated to be shed throughout the corporate in Germany by the top of the last decade.
Additional cuts to come back
Volkswagen Chief Monetary Officer Arno Antlitz mentioned, nonetheless, that the present market atmosphere means the agency’s deliberate price reductions weren’t sufficient.
“We should essentially rework our enterprise mannequin and obtain structural, sustainable enhancements. This contains enhancing the fee construction of our automobiles with out compromising product substance, considerably lowering overhead prices, growing the effectivity of our vegetation, and accelerating know-how growth and decision-making,” Antlitz mentioned.
“We will solely obtain this by considerably lowering complexity – in our product portfolio and know-how platforms, in addition to within the variety of entities and decision-making layers. That is what we’ll give attention to within the coming months,” he added.
Analysts at Citi mentioned they weren’t stunned Volkswagen is looking for much more price reductions, “and we help such selections, however this additionally suggests additional future distinctive prices and highlights the pressures additionally on core VW EU earnings.”
They added: “We proceed to see VW maklng all the precise selections, and onerous selections, to keep up profitability and viability within the face of powerful regulatory and value headwinds, in addition to low-cost Chinese language competitors.”
Trying forward, Volkswagen mentioned it expects working return on gross sales to be between 4% and 5.5% in 2026, after 2.8% in 2025.
