German automobile giant Volkswagen has posted a sharp drop in second-quarter profits, citing US tariffs, rising production costs and an increase in sales of electric vehicles with a smaller profit margin.
Volkswagen profits dropped to just under €2.3 billion ($2.7 billion) in the second quarter of 2025, a 36.3% decrease on same period last year.
The Wolfsburg-based concern said that its Porsche and Audi subsidiaries had performed particularly poorly and that sales in China were also down, but insisted the drop-off was largely in line with analysts' expectations.
Chief executive Oliver Blume insisted that Volkswagen is operating in an "extremely challenging environment," while finance director Arno Antlitz said the results were actually "at the higher end" of the company's expectations. "But, in the end, what matters is the money which actually lands in the till," he said.
"We've made tangible improvements in design, technology and quality," added Blume. "The order books are well-stocked."
Nevertheless, the firm says it will stick to its restructuring plans which it intends to "implement decisively and accelerate where necessary." Volkswagen is expecting to cut 35,000 jobs by 2030.
