Volkswagen's profit drops amid trade tensions and increased tariffs

Wednesday 30 April 2025 - 11:34

By: Zahouani Ilham

Volkswagen's profit drops amid trade tensions and increased tariffs

Volkswagen's net profit for the first quarter of the year decreased by 40.6 percent, dropping to €2.19 billion ($2.49 billion). Despite this, the company saw a 3 percent increase in revenue, which reached €77.56 billion. The 10-brand conglomerate, which includes Audi, Skoda, and Porsche, had already warned earlier in April about the impact of €1.1 billion in one-off costs, affecting its results. These costs were attributed to restructuring at its struggling software division and fines imposed by the EU for selling too many polluting vehicles.

Looking ahead, Volkswagen anticipates that its performance for the remainder of the year will be at the lower end of its expectations, due to rising competition, stricter emissions regulations, and ongoing trade tensions. US President Donald Trump’s trade policies, including a 25 percent tariff on car imports, have added further pressure. North America accounted for just over 11 percent of Volkswagen's vehicle deliveries in the first quarter, making it the company's third-largest market after Western Europe and China. Volkswagen projects a profit margin between 5.5 and 6.5 percent for the coming year.