VW's profit set to plummet by nearly half by 2025 - Volkswagen's 2025 profits tumble as costs and market shifts take their toll

Volkswagen Group faced a challenging year in 2025, with profits and sales both declining. The company's net earnings dropped by nearly half, while vehicle deliveries also decreased slightly. Challenges in key markets and costly strategic decisions, such as extending production of internal combustion engines, added to the financial strain.

The group's net profit plunged from €12.4 billion in 2024 to €6.9 billion in 2025. Revenue also slipped by 0.8 percent, landing just under €322 billion. A major factor was the decision to extend production of internal combustion engines, which led to billions in extra costs.

Deliveries fell by 0.5 percent, with 8.98 million vehicles shipped compared to around 9 million the previous year. While sales in Europe rose by 5 percent, this growth failed to cover losses in China and North America. In China, deliveries dropped by 6 percent, and in North America, they fell by 12 to 13 percent.

The third quarter proved particularly tough, with losses exceeding €1 billion. Porsche, a key subsidiary, contributed heavily to the financial burden. Additional pressure came from U.S. tariffs, further squeezing the company's margins.

Globally, Volkswagen remained the second-largest carmaker, though its market share shrank. Toyota stayed ahead, selling between 10.8 and 11.3 million vehicles. Volkswagen did maintain a strong position in electric vehicles, holding a 27 percent share of the European BEV market.

The company's 2025 results highlight the impact of shifting market conditions and strategic choices. With profits down, costs up, and regional sales uneven, Volkswagen Group now faces the task of stabilizing its financial performance. The decline in net earnings and deliveries underscores the challenges ahead.