Volkswagen is preparing to face another difficult year, marked by punitive tariffs and the need to regain ground in China after a disappointing 2025. Europe’s largest automaker reported a sharp drop in operating profit, which fell to 8,9 billion euros, below expectations. For 2026, the German company expects an operating margin between 4% and 5,5%, a modest recovery compared to 2,8% in 2025. US tariffs have impacted the group’s accounts by billions, while local competition in China has eroded significant market shares.
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Volkswagen prepares for a complicated 2026
In the Asian country, Volkswagen lost the top spot to BYD in 2024, while in 2025 it slipped to third place behind Geely. This more complex international context has forced the company to review strategies and growth expectations, with repercussions also on the share value. In fact, the weakness of the results reflects strategic choices and restructuring costs that weighed on the accounts. In particular, the reference is to the setback in the transition to electric by Porsche, which almost wiped out its operating profit in 2025.
Between US tariffs and difficulties in China
Under the leadership of CEO Oliver Blume, Reuters notes, the group has implemented new product launches and reorganization measures aimed at strengthening resilience. But management recognizes that the adjusted margin of 4,6% is not enough to guarantee its long-term sustainability. Analysts at Visible Alpha estimate a margin of 5,2% for 2026, at the upper end of the range indicated by the company. To face the challenge, Volkswagen is focusing on cost-containment measures and a restructuring plan that includes approximately 50.000 redundancies in Germany by 2030.
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