German carmaker Volkswagen on Thursday reported a third-quarter net loss of €1.07 billion ($1.24 billion).
This is its first quarterly loss in five years.
Volkswagen’s earnings have been hit by a number of challenges, including higher US tariffs, as well as a change in strategy for its luxury Porsche brand, which has canceled its previously announced targets on electric vehicle production.
What did VW say about the profit decline?
Finance chief Arno Antlitz said the result was “much weaker” than a year earlier, which he attributed to “higher tariffs, adjusting the product strategy at Porsche and Porsche’s price cuts.”
Without those negative impacts, Volkswagen operating margin would have been 5.4%, Antlitz said, adding that it is “actually, a respectable figure in the current economic environment.”
Volkswagen, which has 10 brands ranging from Skoda and Seat to Audi, said it was losing about €5 billion a year because of US President Donald Trump’s tariff policy. Under the latest EU-US trade arrangement, car exports from Europe now face a 15% tariff – down from the previous 27.5% but still well above the pre-trade-war level of 2.5%.
Porsche, once Volkswagen’s most profitable brand, has also become a source of tension amid sluggish demand for electric sports cars in China and rising competition.
In September, VW warned of a potential €5.1 billion-euro decline in its core profit for the 2025 financial year, after Porsche lowered its medium-term targets. Porsche also announced that it would continue production of the petrol model for longer than planned.
VW Group has since absorbed the restructuring costs and written down the value of its stake in the Stuttgart-based sports car marque. It also faces higher costs for importing parts into the United States from outside North America, increasing financial pressures.
In the first nine months of 2025, VW Group’s net profit is expected to fall by more than 60% to €3.4 billion from €8.8 billion last year.
Edited by: Darko Janjevic