The Volkswagen Group will continue with significant restructuring efforts in order to remain competitive after recording what its financial boss called an “unsustainable” drop in profits for the first nine months of 2025.
The German giant, whose brands include Audi, Porsche and Volkswagen, posted a 58% drop in profits to €5.4 billion (£4.8bn), down €7.4bn (£6.5bn) year on year, leaving it with a pre-tax profit margin of 2.3%.
“This is not sustainable for our business model, in particular in light of the ongoing volatile political situation and market environment,” CFO Arno Antlitz told journalists on Thursday morning.
He blamed the profits drop on a downturn in sales in China, the recent €7.5bn (£6.6bn) restructuring at Porsche (which included a slowdown in its EV transition and the addition of several new ICE models) and the dramatic import tariffs implemented by the US government.
On the US market in particular, Antlitz said: “We were originally planning for a 10% increase in sales, but we recorded a 8% decrease. It is difficult.”
Antlitz predicts the impact of the tariffs (which include the import levy on EU-built cars rising from 2.5% to 15%) to cost the Volkswagen Group €2.1bn (£1.8bn) this year and another €4bn (£3.5bn) next year.
Without the US tariffs, the Group would have recorded a margin of 4.5%, it said, and without the Porsche restructuring, it would have recorded 5.4% (the same as the first nine months of 2024), signifying the impact of both events.
Antlitz said the Group is looking at how to mitigate the impact of the US tariffs. One report suggests it is looking at building an Audi plant in North America, but Antlitz wouldn't confirm this.
More broadly, in order to return to sustainability, Antlitz said the Group will continue with its heavy cost saving measures which began last year. To date, some 12,000 staff have been laid off, of which 11,000 were from the Volkswagen brand.
The Group said last year it would lay off 35,000 staff by 2030. This, Antlitz confirmed, will result in €6bn (£5.3bn) in savings by the end of the decade, €4bn (£3.5bn) of which will be from the Volkswagen brand. Porsche and Cariad (the Group's software division) are the other two main areas of the business where costs will be reduced.
“The major effect comes from the wage dampening,” he said. “That is a billion [euros] this year and another 500 million [euros] next year.”
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