Volkswagen Faces Financial Struggles and Strategic Overhauls

Europe's largest automaker reports a sharp profit decline as it grapples with challenges in China, restructuring costs, and shifting market demands.

Volkswagen's 2024 net profit fell by 31% to €12.4 billion, with its operating margin dropping to 5.9%, down from 7% the previous year.
The company is implementing a €1 billion cost-cutting program, including plans to reduce 35,000 jobs in Germany by 2030 without forced layoffs.
China, once a major profit driver, saw VW's earnings drop to €1.7 billion in 2024, with further declines expected in 2025 due to intense competition and delayed product rollouts.
CEO Oliver Blume emphasized a dual focus on electric vehicles and flexible powertrain options, while also reevaluating the company's EV strategy to better align with market realities.
Proposed EU regulatory changes on CO₂ targets could provide temporary relief, but geopolitical uncertainties, including potential U.S. tariffs, remain a concern for future performance.