acf domain was triggered too early. This is usually an indicator for some code in the plugin or theme running too early. Translations should be loaded at the init action or later. Please see Debugging in WordPress for more information. (This message was added in version 6.7.0.) in /home/ecg/ecgassociationdev/wp-includes/functions.php on line 6121Automotive News Europe — 2026-03-10
Automotive Industry
Volkswagen Group expects its dwindling profit margin to recover somewhat this year but warns of a possible further stagnation in sales after a bruising 2025 hit by tariffs, tough competition from China and a costly shift toward electric vehicles.
The German auto group said it expects an operating margin of between 4 and 5.5 percent in 2026, after it stood at 2.8 percent in 2025.
Last year’s margin came in slightly below an expected 2.9 percent, according to analysts polled by Visible Alpha, and slumped from 5.9 percent a year earlier.
Current operating margins aren’t sufficient in the long-run, CFO Arno Antlitz said in a statement, adding the manufacturer will continue to restructure while targeting more sales in the U.S.
The company proposed a dividend of €5.26 ($6.12) a share for 2025, a decline of 17 percent.
Like its rivals, VW Group has been battling challenges across key markets, with U.S. tariffs costing the company billions and local competition eating into its market share in China.
“We are operating in a fundamentally different environment,” CEO Oliver Blume said in a statement.
Adjusted operating profit fell 54 percent to €8.9 billion in 2025, missing an analysts’ forecast of €9.4 billion.
Revenue stagnated at €322 billion, with scant hopes for growth in 2026, when the company expects revenue to develop in a range of 0 percent to 3 percent.
Antlitz said product launches and restructuring measures in 2025 were important to boost Volkswagen’s resilience.
“But the operating margin of 4.6 percent adjusted for restructuring is not sufficient in the long run,” he added.
Charges and write-downs at Porsche led the drop with the 911-maker’s margins almost flat.
Porsche, whose stalled EV strategy dragged the parent deep into the red in the third quarter, saw its operating profit almost disappear entirely, falling by 98 percent to €90 million in 2025. Its operating margin fell to 0.3 percent after 14.5 percent in 2024.
VW Group is fighting back against a fast-moving competition in China, still the company’s biggest market, and soft demand in Europe where the shift to EVs remains volatile.
The U.S.-Israeli war in Iran is also raising risks on supply-chain disruption and that consumers delay spending.
Energy and fuel prices have surged since the start of the conflict, stoking inflationary fears. Freight rates have also started to rise.
Continental AG, one of the world’s largest tiremakers, warned last week of a negative impact on sales and earnings because of higher costs of oil-derived materials and logistics.
VW in January already reported higher-than-expected automotive cash flow for last year, after delaying several projects and investments as part of an overhauled EV strategy. Carmakers across the industry have cut back on aggressive battery-car rollouts, after demand trailed expectations.