Volkswagen Group is warning that its growing electric vehicle business is putting additional pressure on earnings, as nine-month operating profit fell to €100 million following €8.7 billion of special items, equivalent to a 3.8% operating return on sales.
Chief financial officer and chief operating officer Arno Antlitz said that level was insufficient to support the investment the business needs.
Reported operating profit was down from €5.4bn in the first nine months of 2025, while revenue fell 2% to €233.4bn from €238.7bn.
Volkswagen Group is warning that its growing electric vehicle business is putting additional pressure on earnings, as nine-month operating profit fell to €100 million following €8.7 billion of special items, equivalent to a 3.8% operating return on sales.
Chief financial officer and chief operating officer Arno Antlitz said that level was insufficient to support the investment the business needs.
Reported operating profit was down from €5.4bn in the first nine months of 2025, while revenue fell 2% to €233.4bn from €238.7bn.
The special items included a €6.4bn non-cash impairment of Porsche goodwill, around €1bn of non-cash asset impairments at fully consolidated Chinese companies and expenses from the planned sale of Volkswagen Osnabrück.
EV orders rise as margins tighten
European order intake increased around 4% to 3.0 million vehicles during the first nine months, with battery electric vehicle orders rising 39%.
The group’s European order bank reached approximately 1.1 million vehicles at the end of September, up 11% from the end of 2025. Electric vehicles accounted for around 40% of that total, with the Electric Urban Car Family securing 150,000 orders.
However, Volkswagen said the growing share of lower margin electric vehicles was weighing on earnings alongside pricing pressure and difficult trading conditions in China.
Antlitz said: “At the same time, US tariffs weigh on us, the Chinese market is shrinking, and competitive pressure in Europe is increasing significantly. The market success of our electric vehicles is putting additional pressure on our earnings, as we currently earn less from electric vehicles than from combustion-engine vehicles.”
Group vehicle sales fell 11% to 5.9 million. Excluding Chinese joint ventures, the decline was 1%. Its financial services division revenue increased 8%, partly offsetting a 4% decline in automotive revenue.
Volkswagen presses €31bn cost programme
Volkswagen’s response includes reducing model complexity, simplifying its structure, cutting vehicle and overhead costs, improving factory efficiency and accelerating technology development.
Antlitz said: “After nine months, our operating return on sales before special items stands at 3.8 per cent. That is too low to continue investing strongly in our future.”
Describing the measures in its Future Plan, he added: “Together, these form a comprehensive cost programme of around €31 billion. What matters now is swift and consistent implementation.”
For the full year, Volkswagen expects revenue of around €315bn and an operating return on sales of up to 1%. Automotive net cashflow is forecast at between €3bn and €6bn, with year-end net liquidity of €32bn to €34bn.
Volkswagen said the outlook assumes the current international tariff situation remains unchanged. Volkswagen said the potential impact of a further escalation in the Middle East could not be reliably assessed and was not reflected in its forecasts.
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