Restructuring could cut up to 100,000 jobs, close four German plants
German automaker Volkswagen said Thursday that it posted a 5.8 billion euro ($6.5 billion) after-tax loss for the July-September quarter, as large one-time charges piled on top of weak demand in China, U.S. tariffs and lower profits from electric vehicles.
The results underline the challenges facing the company as it seeks to cut costs through a restructuring that could mean the loss of up to 100,000 jobs and the closure of four German plants.
Chief financial officer Arno Antlitz said in a statement that the company’s results so far this year mean “we cannot afford to lose any time and must act quickly and decisively.”
Sales revenue decreased 6.3% to 80.3 billion euros from the year-earlier quarter. Earnings also suffered from a 6.4 billion euro reduction to account for the fallen value of Volkswagen’s stake in luxury carmaker Porsche.
China was once a key profit center for Volkswagen. The company now faces declining demand for cars there on top of fierce price competition from local carmakers.
U.S. tariffs, or import taxes, imposed by President Donald Trump have also weighed on profits, as has the increasing share of electric vehicles, which earn less per vehicle than internal combustion models.