Volkswagen loses €5.8 billion in the third quarter, mainly because of a writedown on Porsche

Volkswagen made a heavy loss in the third quarter of 2026. From July to September it recorded a loss after tax of €5.8 billion, after a loss of €1.1 billion in the same quarter a year earlier, the group said in Wolfsburg on 29 October. Its operating result for the quarter was minus €5.9 billion. For the first nine months that leaves an operating profit of €71 million, against €5.4 billion in the same period last year; after tax there is a loss of €2.7 billion.

Arno Antlitz, the group's chief financial and chief operating officer, said Volkswagen could not afford to lose any time and had to act quickly and decisively.

A multibillion writedown on Porsche

The decisive factor is special items of €8.7 billion in the first nine months, €7.8 billion of them in the third quarter. The largest is an impairment of €6.4 billion on the goodwill that Volkswagen allocates to its Porsche business segment. On top of that come impairments of about €1 billion on assets of fully consolidated companies in China and expenses for the planned sale of Volkswagen Osnabrück GmbH. The impairments do not involve any cash outflow, and the writedown on Porsche's goodwill does not reduce the tax bill.

Volkswagen had already announced the writedown, then put at about €6 billion, on 18 September. At the same time it cut its forecast for the 2026 operating return on sales to up to 1%, having previously expected 4.0 to 5.5%. Volkswagen gives as reasons for the impairment Porsche's updated long-term planning, with a medium-term return corridor of 10 to 15% and lower volumes, and higher costs of capital. Before special items, the group made an operating profit of €8.8 billion in the first nine months, an operating return on sales of 3.8%.

Lower sales in China and North America

Revenue fell by 2.2% in the first nine months to €233.4 billion, and by 6.3% in the third quarter to €75.3 billion. Including its Chinese joint ventures, the group delivered 6.0 million vehicles to customers, 9.0% fewer than a year earlier. Deliveries fell in North America and Asia-Pacific and rose in Europe and South America. Antlitz named US tariffs, the shrinking Chinese market and sharply rising competitive pressure in Europe as burdens. He added that Volkswagen still earns less on electric cars than on combustion-engine models.

In Europe, by contrast, the group sees growing demand: orders there rose by 4% in the first nine months to 3.0 million vehicles, and by 39% for fully electric models. Electric cars made up about 40% of the European order backlog at the end of September, and the Electric Urban Car Family had about 150,000 orders. Net cash flow in the Automotive Division rose to €4.4 billion, mainly because of lower investment and portfolio measures. Net liquidity stood at €33.0 billion at the end of September.

What it means for employees

In Germany, 274,126 people worked for the group at the end of September, 3.5% fewer than at the end of 2025. Worldwide, including the Chinese joint ventures, the figure was 648,149. Antlitz said Volkswagen's future plan amounts to a cost programme of about €31 billion, including fewer models, simpler structures and more efficient plants. In December 2024, Volkswagen AG and the IG Metall union had already agreed to cut more than 35,000 jobs at the German sites by 2030 in a socially responsible way. According to the company, the future plan means that a further 12,000 jobs are to go at Volkswagen AG by 2030.

At the end of September, Volkswagen AG gave notice on ten collective agreements with effect from 31 December 2026. Under the statutory rules, the terminated agreements continue to apply for the time being, so nothing changes for employees for now, the company said. The future collective agreement (Zukunftstarifvertrag), with its job security, is not affected by the notice. Talks with IG Metall start on 24 November in Emden and continue on 15 December in Zwickau. Volkswagen considers the union's demand for 5% more pay unsuited to the situation of the company and the industry.

Forecast for 2026 confirmed

For the full year, Volkswagen still expects revenue of about €315 billion and an operating return on sales of up to 1%, after 2.8% in 2025. According to the company, the forecast does not take into account possible effects of the escalation in the Middle East, nor the implementation of the future plan or the sale of a majority stake in Everllence SE of Augsburg, a maker of large engines and turbomachinery.