By Rachel More
BERLIN, April 30 (Reuters) – Volkswagen must fundamentally overhaul its business as tariffs, geopolitical shocks and weak car demand batter the industry, the automaker said on Thursday, with a sharp first-quarter profit drop underscoring the urgency.
“In this environment, the cost-cutting measures planned so far are not enough,” finance chief Arno Antlitz said as the company presented quarterly results, calling for further steps to secure the German group’s future.
Volkswagen reported an unexpected 14% fall in first-quarter operating profit to 2.5 billion euros ($2.9 billion). Analysts had expected profit to be broadly flat, according to a Visible Alpha poll.
The group, which includes Porsche and Audi, has been hit by steep U.S. tariffs expected to cost about 4 billion euros a year, and is battling to arrest sliding sales in China and the U.S.
Around 50,000 jobs are already to be cut across the group in Germany by 2030.
The Wolfsburg-based company posted quarterly revenue of 75.7 billion euros, down 2.5% and below analysts’ estimate for 77.6 billion euros.
That translated into an operating margin of 3.3%. Volkswagen forecasts an operating margin of between 4 and 5.5% in 2026, after 2.8% in 2025.
The group confirmed its full-year guidance but warned that it does not factor in a potential escalation in the Middle East conflict, which could hit demand and drive up raw material costs globally.
($1 = 0.8576 euros)
(Reporting by Rachel More. Editing by Kirsti Knolle and Mark Potter)
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