Volkswagen Group Halves 2025 Profit Forecast, Plans 50,000 Layoffs and Cuts EV Investment

Volkswagen Group released its 2025 financial results on March 10, reporting a 53% year-over-year plunge in operating profit and an operating margin of just 2.8%. Despite global vehicle deliveries remaining stable at approximately 9 million units (a slight 0.5% decline) and revenue largely flat, the company faced significant headwinds. Key factors behind the profit slump include nearly €5 billion in costs from U.S. tariffs, an 8% drop in sales in China, lackluster performance of electric vehicle models, and weak returns on transformation-related investments. Nearly all group brands came under pressure, with Porsche emerging as the largest source of losses. To address these challenges, Volkswagen plans to cut 50,000 jobs in Germany by 2030 and reduce its planned R&D and transformation investments for 2025–2029 to €160 billion. The group also announced an accelerated product renewal strategy, aiming to launch 30 new models by the end of 2027. Additionally, it will roll out its "largest-ever" new energy vehicle offensive in China in 2026, introducing more than 20 electric models, with a clear focus on improving profitability and operational efficiency.