Volkswagen posts €5.8 billion Q3 loss on Porsche writedown

Volkswagen lost 5.8 billion euros ($6.5 billion) after tax in the third quarter. One-time charges added to weak demand in China, U.S. tariffs and lower profits on electric vehicles, the Associated Press reported. The company's operating loss was about 5.9 billion euros, its worst quarterly result since the "Dieselgate" charges at the end of 2015, a company spokesperson told Reuters. Analysts polled by Visible Alpha had expected a loss of 2.6 billion euros, Reuters noted.finance.yahoo.com+2

"The nine-month results make one thing clear: We cannot afford to lose any time and must act quickly and decisively," CFO and COO Arno Antlitz said in the company's results release.volkswagen-group.com

Writedowns drive the loss

Special items in the quarter came to 7.8 billion euros. They include a non-cash goodwill impairment of 6.4 billion euros on Porsche Dr. Ing. h.c. F. Porsche AG, about 1 billion euros in impairments on fully consolidated companies in China, and costs tied to the planned sale of the Osnabrück plant, according to Volkswagen. Quarterly revenue fell 6.3% to 75.28 billion euros, and the operating margin was negative 7.8%, Dow Jones reported. Third-quarter deliveries fell 14% to 1.89 million vehicles.morningstar.com+1

Antlitz named the main pressures. "U.S. tariffs weigh on us, the Chinese market is shrinking, and competitive pressure in Europe is increasing significantly," he said, adding that the company "currently earn[s] less from electric vehicles than from combustion-engine vehicles," Dow Jones reported. Over the first nine months, operating profit fell 98.7% to 71 million euros, Investing.com reported.uk.investing.com+1

Guidance held, restructuring continues

Volkswagen kept the full-year guidance it cut in September. It still expects revenue of about 315 billion euros, an operating return on sales of up to 1%, and automotive net cash flow of 3 billion to 6 billion euros, Dow Jones reported. It expects to deliver about 8.2 million vehicles this year, down from 9 million in 2025, mainly because of falling sales in China.morningstar.com

Before special items, the nine-month operating margin was 3.8%. "That is not enough in the long term," Antlitz said, according to Reuters. The group is aiming for an operating margin of 8% to 10% by 2030.centraloregondaily.com

Job cuts and plant closures

Last month, the supervisory board approved a plan to double job cuts to 100,000 and halve the model lineup, Dow Jones reported. Up to four German plants could close under the plan. Unions strongly oppose it, and strikes could start early next year, Reuters reported. Euronews reported that the restructuring will cost 31 billion euros.euronews.com+2

"What matters now is swift and consistent implementation," Antlitz said.volkswagen-group.com