Findings indicate that the measures were deemed unnecessary by the Commission.
Volkswagen Group Sees Significant Profit Drop in Q2 2025
The Volkswagen Group, a leading automobile manufacturer, has reported a substantial decline in profits for the second quarter of 2025. The operating profit dropped by over 29%, amounting to €3.83 billion, compared to over €5.4 billion in the same period last year. This decline is primarily due to increased costs from US tariffs, restructuring, and lower margins on electric vehicles (EVs).
One of the key factors contributing to this profit drop is the US tariffs. The Group has incurred approximately €1.3 billion in costs due to these tariffs in the first half of 2025. With tariffs rising to 30% on EU imports to the US as of August 2025, these costs are expected to continue impacting North American sales, leading to tighter inventories and delayed launches.
Another significant factor is the restructuring costs. These costs added approximately €700 million to the Group's expenses during the quarter.
The growing electric vehicle business is also weighing on results, as the profitability of EVs is currently lower than that of internal combustion engine vehicles, negatively impacting overall margins.
The performance of premium brands Porsche and Audi has also been poor, contributing to the profit drop. Despite a slight increase in vehicle deliveries, sales revenue fell by about 3%.
Volkswagen's core brand, however, has fared better. The brand earned significantly more in the months of April to June: €991 million. The Group's large savings program, which aims to cut 35,000 jobs by 2030, is benefiting the core Volkswagen brand financially.
In response to these challenges, Volkswagen has lowered its full-year operating return on sales forecast to 4%-5%, down from the previous 5.5%-6.5%. The company now expects sales revenue to be flat year-over-year rather than growing by up to 5%.
Despite the short-term profit challenges, the company remains focused on electrification and market stability in key regions. Volkswagen continues to maintain its leading position in Europe with a 28% market share in electric vehicles. The effects on Audi and Porsche, which are part of the Volkswagen Group, will be part of this broader group trend but have not been detailed explicitly.
References: [1] Reuters: Volkswagen Group profits drop sharply in Q2 2025 [2] Autocar: Volkswagen Group Q2 2025 profits plunge due to US tariffs and weak Porsche and Audi [3] Bloomberg: Volkswagen Group Sees Profit Drop in Q2 2025 Amid US Tariffs and EV Challenges [4] CNBC: Volkswagen's growing electric vehicle business is weighing on results, CFO says
The Volkswagen Group's profits decline in Q2 2025 can be attributed to the impact of US tariffs, restructuring costs, and lower margins on electric vehicles (EVs) in their business. Additionally, the poor performance of premium brands Porsche and Audi has further contributed to this profit drop in the finance industry.
