Core VW brand deliveries drop 14% in Q2
Volkswagen reported weak second-quarter sales on Friday, a day after the German automaker said it would cut its model lineup by nearly half, as sales in China fell by more than a third.
The Wolfsburg, Germany-based company said group sales fell 8.6% in the second quarter to just under 2.1 million vehicles. Sales in China alone plunged by more than one-third, the company said, without providing a precise figure. The decline in China, Volkswagen’s largest single market, accelerated a trend that has seen the company lose ground to local electric-vehicle makers such as BYD.
The sales report came one day after a supervisory board meeting in which Volkswagen said its restructuring of the past three years had entered its next phase. The company announced plans to simplify its model range by up to 50%, without providing details on which models would be cut.
CEO Oliver Blume outlined plans to make Volkswagen faster and more competitive through less complexity, focused technologies, better alignment between regional markets, and reduction of excess capacity, the company said.
Among Volkswagen’s major brands, the core Volkswagen passenger-car unit delivered just over 1 million vehicles in the second quarter, a 14% decline from a year earlier. Audi deliveries fell 8% and Porsche deliveries dropped 18%, the company reported.
The weak results add to the challenges facing Europe’s largest automaker. Volkswagen is already grappling with high domestic labor costs, the cost of transitioning from combustion engines to electric vehicles, and billions of dollars in additional costs from U.S. tariffs. The company has been in discussions with labor unions about potential job cuts and factory closures, with reports in June suggesting up to 100,000 jobs could be cut and four German plants closed.
The sales decline in China has been particularly severe. Volkswagen’s profit in China has collapsed from about $5 billion a decade ago to a projected total below $500 million this year, according to previous reports. The company has launched a “in China, for China” strategy, investing $3.5 billion in development facilities in Hefei to design cars specifically for the Chinese market.