German auto large Volkswagen posts 37% drop in first-quarter revenue

German auto large Volkswagen on Wednesday reported a considerable drop in first-quarter revenue because the carmaker navigates the disruptive impression of U.S. tariffs on the worldwide automotive business.

Europe’s greatest carmaker reported working revenue of two.9 billion euros ($3.3 billion) for the primary three months of the 12 months, down 37% from the identical interval final 12 months.

Volkswagen reported first-quarter gross sales income of 77.6 billion euros, up 2.8% from the primary quarter of 2024. The corporate cited larger car gross sales in markets exterior China as underpinning the rise.

Earlier this month, Volkswagen warned that first-quarter working revenue would seemingly are available in at 2.8 billion euros, citing particular results within the magnitude of 1.1 billion euros.

In an advert hoc assertion on April 9, the corporate acknowledged that the preliminary first-quarter consequence deviated considerably from analyst expectations of round 4 billion euros.

“As anticipated, the Volkswagen Group skilled a combined begin to the fiscal 12 months,” Arno Antlitz, chief monetary officer and chief working officer at Volkswagen Group, mentioned in a press release.

“Given the present unstable world financial state of affairs, it’s much more vital to concentrate on the levers inside our management. This implies complementing our nice product vary with a aggressive value base – so we will guarantee to succeed additionally in quickly altering world markets,” Antlitz mentioned.

Different first-quarter highlights included:

• Volkswagen reported 2.1 million car gross sales within the first three months of the 12 months, 0.9% above the identical interval in 2024.
• First-quarter order intakes for automobiles in Western Europe jumped by 29% in comparison with the earlier 12 months.
• Web money movement got here in at -0.8 billion euros, above the earlier 12 months.

olkswagen posted working revenue of 4.59 billion euros for the primary quarter of 2024 and 6.15 billion euros for the ultimate three months of 2024.

Wanting forward, Volkswagen mentioned it expects working return on gross sales, web money movement and web liquidity to return in on the decrease finish of annual forecasts, citing political uncertainty, growing commerce restrictions and emissions laws.

Shares of Volkswagen are up almost 10% year-to-date.

The sector is understood to be acutely weak to Trump’s back-and-forth commerce coverage, notably given the excessive globalization of provide chains and the heavy reliance on manufacturing operations throughout North America.

Trump on Tuesday signed an govt order to ease some auto tariffs, offering some reduction to the worldwide sector.

Tariffs of 25% on imported automobiles into the U.S. will proceed, however the brand new measures goal to cut back the general stage of duties on car imports that had resulted from separate levies — reminiscent of a further 25% tariffs on metal and aluminum — “stacking” on high of each other.

Underneath the most recent White Home order, further 25% tariffs on auto elements that had been set to begin by Might 3 will even nonetheless take impact, however automobiles that undergo remaining meeting within the U.S. will have the ability to qualify for partial reimbursements on these levies for 2 years.

— CNBC’s Michael Wayland & Michele Luhn contributed to this report.