Crisis in the auto industry: 5.82 billion euros loss for VW

dpa | A Porsche depreciation worth billions, weak business in China and costs for the group restructuring pushed Volkswagen deep into the red in the third quarter. The car manufacturer announced that consolidated earnings after taxes were around minus 5.82 billion euros in the months from July to September. VW also reported a deficit in the same quarter last year, at that time it was a good 1.07 billion euros.

The main reason for the loss were special effects of 7.8 billion euros. According to the information, the weak market environment in China, increasing global price and competitive pressure as well as the increased share of lower-margin electric cars in sales also had a negative impact. The group's sales fell by 6.3 percent to around 75.28 billion euros in the third quarter.

A write-down on the goodwill of the sports and off-road vehicle subsidiary Porsche has a particularly strong impact. According to the information, it amounts to around 6.4 billion euros. The value adjustment is not cash-effective, but it has a significant impact on VW's operating profit. The background is lower expectations for the future development of Stuttgart.

A year earlier, the situation at Porsche was one of the main reasons for the quarterly loss. The luxury brand, once a pearl of the company's profits, has been in crisis for a long time. The slump in business with China, US customs policy and course corrections in the electrical strategy had a particularly negative impact. Porsche's business figures had recently stabilized.

Sales continued to decline across the entire group: from July to September, VW delivered 1.89 million vehicles - almost 14.3 percent less than a year earlier. VW is under considerable pressure, particularly in the important market of China. The Wolfsburg-based company sold almost 406,000 vehicles there in the third quarter (minus 38.5 percent). By the end of September, the group's brands handed over 6 million vehicles to their customers. That was 9.0 percent or around 600,000 fewer than in the same period last year.

VW management around CEO Oliver Blume had already significantly lowered its profit forecast for the current year in mid-September. A maximum of one percent of sales should remain as operating profit in the current year. VW had previously expected a range of 4.0 to 5.5 percent. In 2025, the operating return was 2.8 percent.

Sales are expected to reach around 315 billion euros in 2026. That would be in the middle of the previous forecast range. The group had already capped its expectations in July. Instead of an increase in sales of up to 3 percent compared to the previous year, Volkswagen only expects stable development in the best case scenario. But there could also be up to 3 percent less revenue. Last year, sales were 321.9 billion euros.