Volkswagen (ETR:VOW3) executives used the company’s annual media conference in Wolfsburg to outline 2025 results shaped by geopolitical tensions, tariffs and pricing pressure, while emphasizing progress on cost-cutting, restructuring and a broad product push.
Chief executive officer Oliver Blume said 2025 was “a year of progress” as the group advanced its product program, streamlined structures and improved governance, but also faced “unprecedented challenges” from trade barriers and intense competition. Chief financial officer Arno Antlitz described the year as “quite a challenging” one and said profitability remains too low to support long-term investment without further cost reductions and complexity cuts.
2025 deliveries and regional performance
- Europe remained the group’s “strong base,” with Blume citing a 4% sales increase and market share of more than 25% in the home market.
- In Europe, battery-electric vehicle (BEV) sales rose 66% year over year, according to Blume, giving the group a 27% share and making it the “clear market leader.”
- North America deliveries fell 10% and China deliveries declined 8%, both described as expected outcomes.
- South America grew 12%, Asia excluding China rose 9%, and the Middle East and Africa increased 10%.
Antlitz added that global BEV deliveries rose 32% in 2025 and represented 11% of total group deliveries. In Europe, he said BEVs accounted for roughly 19% of the group’s deliveries, and “every fourth electric vehicle sold in Europe” came from the Volkswagen Group.
Revenue, profit, cash flow, and dividend proposal
Group revenue was about EUR 322 billion, nearly flat year over year, with Antlitz attributing the slight decline mainly to currency effects. Operating profit was EUR 8.9 billion, down 53% from the prior year, corresponding to an operating margin of 2.8%.
Management repeatedly highlighted the impact of tariffs and one-off items. Blume said direct and indirect effects from U.S. tariffs alone amounted to around EUR 5 billion. Antlitz provided a breakdown of special effects totaling about EUR 5.9 billion, including:
- EUR 2.7 billion related to a Porsche goodwill impairment
- About EUR 2.0 billion tied to adapting Porsche’s product strategy
- EUR 1.3 billion in restructuring costs
Excluding special effects, Antlitz said the operating return on sales was 4.6%. Excluding tariffs as well—costing EUR 2.9 billion in the last nine months of 2025—he said the margin would have been 5.5%, which Blume described as the lower end of the company’s original forecast range.
Automotive division net cash flow rose to EUR 6.4 billion, up EUR 1.3 billion year over year, helping keep net liquidity stable at about EUR 34.5 billion. Antlitz said the improvement was driven by a strong second half, especially the fourth quarter, aided by inventory reduction and disciplined capital spending. He cited EUR 4.8 billion of inventory reduction in the fourth quarter versus the third quarter and EUR 2.0 billion lower inventories compared with the end of 2024.
The board plans to propose a dividend of EUR 5.26 per preferred share for fiscal 2025 at the annual general meeting in June.
Divisional and brand group highlights
Antlitz said the automotive division recorded operating profit of EUR 5.0 billion, down 64%, with Porsche’s realignment, U.S. tariffs and restructuring weighing heavily. In heavy commercial vehicles, operating profit fell 43% to EUR 2.4 billion. Financial services increased operating profit 19% to EUR 3.7 billion, driven mainly by Europe.
Within the Brand Group Core, Antlitz said operating profit was EUR 6.8 billion and the margin was 4.7%, roughly in line with the prior year. He highlighted Škoda’s margin of 8.3% as an example of strong products combined with competitive cost structures. He also said the Volkswagen brand made progress, with stable earnings for the year despite tariff burdens of around EUR 900 million.
For Brand Group Progressive, Antlitz said operating profit was EUR 3.4 billion, down 14%, with a margin of 5.1%. He said Audi delivered a double-digit margin in the fourth quarter and achieved record BEV deliveries, but profitability was pressured by tariffs and a high share of fully electric models.
Technology platforms continued to weigh on results, though Antlitz pointed to improvement at CARIAD. He said CARIAD increased licensed income and reduced its operating loss to EUR 2.2 billion. PowerCo’s operating loss increased with the ramp-up of production capacity, but the company began cell production at the Salzgitter gigafactory on schedule at the end of 2025; the first European-made cells are planned to enter series vehicle production starting in 2026.
Restructuring, cost targets, and product roadmap
Blume said the company has already achieved around EUR 1 billion in cost savings in 2025 at Volkswagen, Audi, Porsche and Cupra. He reiterated an ambition to reach more than EUR 6 billion in annual cost savings by 2030 from “future packages” and said the group is targeting an operating return on sales of 8% to 10% by 2030.
In the Q&A, Blume said Volkswagen, Audi, Porsche and CARIAD are planning to eliminate 50,000 jobs as part of the future package (including 35,000 previously referenced for Volkswagen) and reduce capacity, citing an expected 700,000-unit capacity reduction at Volkswagen as European demand remains about 15% below pre-COVID levels. He confirmed Audi’s Brussels plant closure, said Dresden is intended to shift toward a research focus, and noted that no decision has been made yet for Osnabrück, where the group is in talks with defense companies about potential solutions.
On products and technology, Blume outlined a 2026 model push of more than 20 new vehicles and described an “electric urban car family” spanning four models across three brands on one platform, with Cupra Raval scheduled for a world premiere in the coming weeks. He also cited upcoming BEVs such as the Audi E3 CUV and Porsche Cayenne Electric.
In China, Blume said the group expects around 30 electrified launches by 2027 with local partners, with development times cut by up to 30% and material costs on the local CMP platform reduced by more than 40%. He said the company expects 2026’s China joint-venture operating contribution to be “a bit weaker than in 2025” due to launch effects but with a positive tendency, followed by “a clearly positive leap” in 2027.
2026 outlook and key watch items
For 2026, Antlitz said the group expects largely stable global demand but continued high competitive pressure. Guidance calls for revenue growth of 0% to 3%, an operating margin of 4% to 5.5%, automotive net cash flow of EUR 3 billion to EUR 6 billion, and net liquidity of EUR 32 billion to EUR 34 billion.
Executives also addressed ongoing uncertainties including Middle East conflict risks, tariff exposure in the U.S., and intensifying competition from Chinese automakers in Europe. Blume said the group is not currently seeing a noticeable adverse effect from Chinese brands in Germany, but expects growing pressure and framed further cost reductions as essential preparation.
About Volkswagen (ETR:VOW3)
Volkswagen AG manufactures and sells automobiles in Germany, Europe, North America, South America, the Asia-Pacific, and internationally. The company operates through four segments: Passenger Cars and Light Commercial Vehicles, Commercial Vehicles, Power Engineering, and Financial Services. The Passenger Cars and Light Commercial Vehicles segment engages in the development of vehicles, engines, and vehicle software; produces and sells passenger cars and light commercial vehicles, and related parts; and offers motorcycles.
