Volkswagen to ‘accelerate’ cost-cutting measures amid falling profits
Group’s operating result for the first half of 2026 was down 12 per cent on the previous year.
Volkswagen Group will look to cut costs across its operations as it announced a fall in profits for the first half of 2026.
The Group, which owns brands such as Volkswagen, Skoda, Seat, Cupra and Porsche, announced an 11.6 per cent drop in profits with a total revenue of €158bn (£135bn) in the first half of the year.
In a statement, Volkswagen Group CEO Oliver Blume said that the Group was working within a ‘challenging environment’ and that it would look to implement ‘disciplined cost management’.
“For the full year, we expect a robust performance above the prior year in a challenging environment – even though our operating result in the first half was around 12 per cent below the prior year. Globally, we delivered more cars than in the previous year – excluding the Chinese market, which slumped by 20 per cent.”
It follows a move by Volkswagen Group earlier in the month to reduce complexity across its portfolio, streamlining line-ups by up to 50 per cent in an effort to focus on more lucrative segments.
Arno Antlitz, CFO and COO Volkswagen Group, added: Despite such progress, our operating margin of 3.8 per cent remains too low and underlines the call to action. In an environment where the Chinese total market is down by 20 per cent and Chinese competitors are increasing exports and thereby competitive pressure in Europe, the currently planned initiatives are not sufficient.
“We must accelerate efforts to structurally lower our cost base and sustainably improve our earnings quality. This includes improved vehicle cost structures, lower overhead costs, higher efficiency in our plants, faster technology development, and quicker decision-making processes.”