Volkswagen posts 5.9 billion euro operating loss in third quarter

Volkswagen Group released its financial results for the July-September period of 2026 and for the first nine months of the year. The group, which owns the Audi, Bugatti, SEAT, Skoda and Porsche brands, reported an operating loss of 5.9 billion euros in the third quarter. Analysts had expected a loss of 2.6 billion euros for the same period. The loss in the third quarter of last year was 1.3 billion euros.

After tax, the group's net loss for the quarter came to 2.7 billion euros. In the same period last year, it had recorded a net profit of 3.4 billion euros. Sales revenue fell 6.3 percent to 75.28 billion euros. Global deliveries dropped 14.3 percent to 1.885 million vehicles. Deliveries in China fell 38.5 percent to 406,000 units as the market contracted.

Porsche write-down of 6.4 billion euros

Porsche was one of the main reasons for the sharp decline in results. Volkswagen booked a 6.4 billion euro write-down on the value of the Porsche brand, citing weaker future prospects. The item involves no cash outflow but directly affects operating profit. Volkswagen also wrote off about 1 billion euros in additional assets due to lost market share in China. Including other items, one-off negative effects totaled 7.8 billion euros.

Net loss of 2.72 billion euros in January-September

The group posted a net loss of 2.72 billion euros for the first nine months of the year. In the same period last year, it made a net profit of 3.4 billion euros. Revenue fell 2.2 percent to 233.378 billion euros, and global deliveries dropped 9 percent to 6.01 million units.

This is the first time since Volkswagen began operating in China that it has booked a period loss in that market. In the January-September period last year, its Chinese operations earned 744 million euros in profit. This year, the same operations posted an operating deficit of 113 million euros in the same period.

Management calls for cost cuts

Finance chief Arno Antlitz said the nine-month results made one thing clear: there is no time to lose, and the company must act quickly and decisively. The results are expected to strengthen the hand of the board under CEO Oliver Blume in its cost-reduction talks with unions. Under the restructuring plan, 100,000 jobs could be cut worldwide. Some sites in Germany could also close, including Volkswagen plants in Hanover, Emden and Zwickau and Audi's plant in Neckarsulm.

In mid-September, management lowered its profit forecast and now expects total revenue of around 315 billion euros by the end of 2026. For this year, the company expects an operating margin of at most 1 percent of revenue. It had previously targeted a margin of 4 to 5.5 percent.