Volkswagen Group reported an operating profit result of €5.93bn ($6.76bn) for the first half of 2026, down 11.6%, in what it described as a “challenging market environment”.
Sales revenue for the first half slipped 0.2% to €158.10bn.
The carmaker said its operating return on sales for the six-month period was 3.8%, compared with 4.2% in the same period last year.
It said the €0.8bn decline in operating profit result was mainly due to costs of about €0.5bn connected to the end of US production of the ID.4, along with unfavourable mix effects.
These factors were partly offset by lower restructuring expenses, favourable currency movements and lower fixed costs.
Excluding special items, operating result was €6.9bn, representing a return on sales of 4.3%.
In the second quarter, sales revenue rose 2% to €82.44bn, while operating result decreased 9.5% to €3.46bn, with return on sales at 4.2%.
Earnings after tax declined 32.9% to €1.53bn in Q2 2026 and fell 30.7% to €3.10bn in H1 2026.
Deliveries to customers totalled 4.13 million units in the first half, down 6.3%, while vehicle sales fell 8.4% to four million.
Growth in South America, Western Europe and Central and Eastern Europe was more than outweighed by a 31.6% decline in China.
North America posted a small increase in the half, supported by second-quarter growth.
By brand group, Core, which includes Volkswagen, Škoda, and Seat/Cupra, recorded an operating result of €3.61bn, up 4.5% year-on-year, on revenue of €73.03bn and a margin of 4.9%.
The company said streamlined product costs, cost discipline and internal synergies contributed to that performance.
The Progressive brand group encompassing Audi, Bentley and Lamborghini posted an operating result of €1.12bn on revenue of €29.17bn.
Sport Luxury, which includes Porsche, reported an operating result of €1.20bn, compared with €832m in the prior-year period.
Revenue fell to €15.15bn from €16.13bn.
Volkswagen has cut its full-year 2026 revenue forecast and now expects sales revenue to be between -3% and 0% compared with the previous year.
Its earlier guidance had projected 0% to +3% growth.
The group left its operating return on sales guidance unchanged at 4.0% to 5.5%.
It also maintained its expectation for an investment ratio of 11% to 12% for the Automotive Division this year.
Volkswagen said the revised outlook reflected macroeconomic pressures, uncertainty over international trade restrictions and geopolitical tensions, stronger competition, volatility in commodity, energy and currency markets, and changing emissions regulations.
It said the forecast assumes current tariff arrangements remain unchanged and does not include any possible effects from an escalation in the Middle East, which it said could not be reliably estimated.
The guidance also excludes any possible effects from the Group Target Picture 2030 strategy or the planned divestment of a majority stake in Everllence.
Earlier this month, chief executive Oliver Blume told staff that a further 50,000 positions could be eliminated, marking the company’s first internal acknowledgement that total job cuts could reach 100,000.
Blume is seeking to reduce costs at the group, which has faced lower profits linked to tariff-related expenses, stronger competition in China and pressure to raise efficiency across its German manufacturing operations.
Volkswagen has already committed to 50,000 job reductions, including in its Porsche and Audi divisions.
Blume said: “Applying disciplined cost management, we have managed to offset continued unavoidable headwinds in the double-digit billions. At the same time, the environment for the automotive industry remains extremely challenging: geopolitical crises, trade conflicts, high regulatory requirements, volatile markets and intensified competition.”
