By Rachel More and Christina Amann
BERLIN, Oct 29 (Reuters) – Volkswagen sank deeper into the red in the third quarter, posting its worst result in more than a decade as the world’s second-largest automaker battles mounting challenges in key markets and pushes ahead with a major restructuring.
Europe’s biggest carmaker reported an operating loss of €5.9 billion ($6.6 billion) for the three months, hit by about €8 billion in one-off items, largely linked to a writedown of its stake in Porsche.
The loss was Volkswagen’s largest quarterly deficit since the fourth quarter of 2015, when the German group booked major one-off charges related to its “Dieselgate” emissions-cheating scandal, a company spokesperson said.
“The nine-month results make one thing clear: We cannot afford to lose any time. We must act quickly and decisively,” finance chief Arno Antlitz said in a video statement.
Shares in the group, already near 10-year lows, initially fell 2%, but were down less than 1% at 0900 GMT.
Quarterly revenue fell 6% to €75.3 billion.
‘WARNING SIGN’ FOR THE SECTOR
The results highlight the pressure on Volkswagen to overhaul its business model as it faces fierce competition in China, billions of euros in annual tariff costs and heavy investment demands from the transition to electric vehicles in Europe, where Chinese rivals continue to gain ground.
“The loss reported by VW today is a warning sign for the entire sector and industry, and should also serve as one for policymakers,” said Moritz Kronenberger of Volkswagen investor Union Investment.
CEO Oliver Blume plans to cut 100,000 jobs across the group, which includes the Audi and Porsche brands. Up to four plants in Germany face closure under the plan, which has drawn fierce opposition from unions and could trigger strikes from early next year.
Antlitz said Volkswagen’s operating return on sales margin was only 3.8% in the first nine months of the year, even before the one-off items.
“That is not enough in the long term,” he added.
Volkswagen is targeting an operating profit margin of 8%-10% by 2030 under its restructuring programme.
Last month, the company flagged €10 billion in one-off costs and slashed its 2026 profit margin forecast to no more than 1%.
($1 = 0.8959 euros)
(Reporting by Rachel More and Christina Amann; Additional reporting by Christoph Steitz; Editing by Adam Jourdan, Thomas Derpinghaus and Mark Potter)
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