Ford Germany Faces Uncertainty Amid Corporate Restructuring

Volkswagen Faces Profit Decline Amid Global Challenges

Volkswagen, one of the world's largest automakers, has reported a significant decline in net profit by 30.6%. The German giant has been facing stiff competition in China, coupled with rising costs associated with restructuring efforts, including the closure of the Audi plant in Brussels. These factors have led to an operating margin drop from 7.0% to 5.9%. Despite a slight increase in revenue, Volkswagen plans to cut its dividend by 30% as a cost-saving measure. The company is also planning a major workforce reduction, with a projected cut of 35,000 jobs in Germany by 2030. This move is part of a broader restructuring strategy aimed at streamlining operations and maintaining competitiveness in an evolving automotive market. Volkswagen is navigating a landscape fraught with political uncertainties, increased trade restrictions, and geopolitical tensions, which further impact its financial outlook. The company aims for a revenue growth of up to 5% and an operating return on sales between 5.5% and 6.5% moving forward. To adapt to changing industry dynamics, Volkswagen is reducing investments in combustion engine technologies and focusing on partnerships, such as with Rivian, to enhance its software and networking capabilities. The company is also investing in its battery segment, aligning with the global shift towards electric vehicles. In response to the financial challenges, Volkswagen’s management has agreed to an 11% salary reduction in 2025-2026. Despite these setbacks, the automaker remains committed to its long-term goals, hoping these strategic adjustments will pave the way for future growth and stability.