Recently, Volkswagen Group of Germany released its financial results for the first half of 2025, which fell short of market expectations. Specific data shows that the group achieved sales revenue of €158.4 billion in the first half of the year, a slight decrease of 0.3% compared to the same period last year. Operating profit suffered a significant decline, reaching only 6.7 billion euros, a sharp drop of approximately 33% year-over-year, while net profit also decreased by 38.36% to 4.477 billion euros.
In terms of sales volume, Volkswagen Group sold a total of 4.363 million vehicles globally in the first half of 2025, representing a year-over-year increase of 0.5%; with 4.405 million vehicles actually delivered to customers, marking an expanded increase of 1.3%. Among these, pure electric vehicles performed exceptionally well, with 465,000 units delivered, representing a year-on-year increase of 46.7%, accounting for 10.6% of total deliveries, a significant improvement from the 7.3% recorded in the same period last year.
However, the Group’s net cash flow situation continued to deteriorate. In the first half of 2025, Volkswagen Group’s net cash flow stood at -8.39 billion euros, a further deterioration from the -7.05 billion euros recorded in the same period last year; particularly, the net cash flow from the automotive business turned negative, reaching -1.35 billion euros, compared to a positive inflow of 367 million euros in the same period last year. As of the end of June, the Group held a total of 34.8 billion euros in cash and cash equivalents.
In its report, Volkswagen Group cited multiple reasons for the significant decline in operating profit: the U.S. increase in import tariffs resulted in approximately 1.3 billion euros in losses for the company; simultaneously, the Group implemented a restructuring plan involving Audi, the Volkswagen passenger car brand, and its software subsidiary Cariad, for which it set aside 700 million euros in provisions; additionally, costs associated with addressing increasingly stringent carbon dioxide emissions regulations also had an adverse impact on performance.
Although Volkswagen’s total global deliveries increased, changes in sales structure and external environmental factors became key factors eroding its profits. Regional market performance showed a polarized trend: Europe and other emerging markets saw steady growth of 3.3%; the South American market experienced explosive growth, surging by 21.1%. However, challenges arose in two key markets: North America saw a 6.9% decline in sales; and in the critically important Chinese market, deliveries of Volkswagen passenger cars and light commercial vehicles decreased by 2.3% year-on-year.
As a result, the Volkswagen Group has been forced to revise downward its performance expectations for the full year of 2025. Currently, annual revenue is expected to remain flat compared to last year, far below the previously anticipated maximum increase of 5%. Additionally, the expected range for the Group’s overall sales return rate has been adjusted to 4.0% to 5.0%, down from the previous range of 5.5% to 6.5%.
Another notable development is the ongoing aftermath of the Volkswagen “dieselgate” scandal, which shocked the world years ago. Recently, the European Court of Justice ruled that automakers, including Volkswagen, must take responsibility for using cheating methods such as temperature-sensitive emissions control software and compensate consumers. The court emphasized that even if the vehicles themselves meet EU emissions standards, this does not guarantee the legality of the technology used. Regarding compensation standards, the court stated that adjustments can be made based on the actual usage of the vehicles, but the maximum compensation cannot exceed 15% of the purchase price and must fully reflect the extent of harm caused to consumers.
