Volkswagen, Europe’s largest carmaker, reported its first quarterly loss in five years—€1.07 billion—for the July‑to‑September period. The loss, the first since the second quarter of 2020 when the coronavirus pandemic hit, stems from higher U.S. tariffs, a troubled electric‑vehicle shift at its Porsche subsidiary, and write‑downs that reduced Porsche’s value by €7.5 billion. Finance chief Arno Antlitz described the result as “much weaker” than the same period a year earlier and warned that President Donald Trump’s tariff policy is costing the group €5 billion annually.
The challenges facing Volkswagen reflect a broader struggle for traditional manufacturers in Europe’s faltering economy. The company confronts fierce competition in key markets such as China and a slower‑than‑expected transition to electric cars. Porsche, once the crown jewel of the group, has become a liability due to intense pressure from local Chinese rivals and weak demand for electric sports cars. In addition, Volkswagen is grappling with a 15 % tariff on EU‑origin car exports to the United States under the EU‑U.S. trade deal. To mitigate the impact, the firm is considering price increases in the U.S. and the possible establishment of an Audi factory there.
Despite the net loss, Volkswagen’s revenue rose 2.3 % to €80.3 billion, buoyed by a modest increase in global vehicle sales. However, the company also faces a chip shortage that could force plant shutdowns if supplies run out. Volkswagen has warned that production disruptions cannot be ruled out and is seeking alternative sources. The European auto lobby has highlighted that chip supplies are “rapidly dwindling” following a ban on exports from China. Volkswagen’s finance chief assured that the company is “safe until the end of next week,” but production is being secured on a day‑by‑day, week‑by‑week basis.
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