Volkswagen’s executives said the group suffered a 44% fall in net profit for 2025, with after-tax gains dropping to €6.9 billion from €12.4 billion in 2024 — its weakest annual showing since the fallout from the 2016 Dieselgate scandal. CFO Arno Antlitz blamed geopolitical tensions, tariffs and intense competition.
The group plans around 50,000 job cuts across its brands by 2030 as it wrestles with falling demand, faster-rising Chinese competition, and new US tariffs — its two largest export markets. Like the wider German car industry, VW is also navigating the uncertain pace of the shift to electric vehicles amid mixed regional incentives and softer-than-expected consumer demand.
CEO Oliver Blume highlighted some positives, noting relatively stronger VW Group share performance versus the broader industry in a presentation aimed at reassuring investors.
Porsche’s electric slowdown hits profits hardest
A large portion of the group’s profit decline came from Porsche, whose net profit nearly vanished — €90 million in 2025 versus €5.3 billion in 2024. VW attributed the Sport & Luxury segment’s drop to a changed market environment in China, US tariffs, slower EV adoption, and one-off effects tied to the transition.
Porsche’s works council said extending production runs for combustion-engine models late last year caused a one-off hit of about €5 billion, and US tariffs reduced revenues by roughly €3 billion. Porsche has also been hit by rapidly improving Chinese-made luxury and performance cars that have eroded its China market strength.
Other key figures
Despite Porsche’s setback, other parts of the group performed more steadily, helping explain a rise in VW shares after the announcement:
– Group deliveries: 8.98 million vehicles, down 0.5% year-on-year
– Total revenue: €322 billion, down ~0.8%
– VW operating profit: €2.61 billion (up slightly from €2.59 billion)
– Audi operating profit: €3.4 billion (down from €3.9 billion)
– Group operating profit margin: 2.8%, down 3.1 percentage points; VW expects a rebound in 2026
– Performance improved in the fourth quarter after a €1 billion loss in Q3 2025
Job cuts, cost measures and pay impacts
Blume confirmed the group will proceed with agreed job-reduction plans: about 50,000 roles to be cut in Germany by 2030. Roughly 35,000 of those cuts are at the parent company VW, Audi plans up to 7,500 job reductions by 2029, and Porsche has announced around 3,900 cuts. The companies aim to meet targets largely through job-sharing, part-time arrangements for older employees, and voluntary severance rather than mass redundancies.
Blume’s compensation fell as performance weakened and after he was replaced as Porsche CEO. The annual report shows Blume was paid €7.4 million in 2025 (including pension and performance-related payments), down about €3 million. Herbert Diess, Blume’s predecessor who retired in October 2025, remained the top-paid VW manager with €9 million.
Market reaction and longer-term outlook
By midday on Tuesday, Porsche shares were up about 2% and VW shares rose just over 2.5%, reflecting that much of the bad news had already been discounted by markets after a difficult 2025. Both firms’ share prices have more than halved over the past five years; a Porsche share was worth roughly €20 more a year earlier, the same roughly applies to VW stock.
Edited by: Rob Turner
