Written by Cláudio Afonso | LinkedIn | X
Volkswagen Group released its third quarter financial results on Wednesday, posting a net profit drop to €1.57 billion from €4.34 billion a year prior, with revenues dipping slightly by 0.5% to €78.5 billion.
The Group’s flagship VW brand saw its operating margin fall to 2% over the first nine months of 2024, a sharp contrast to the target of 6.5% set for 2026 as workers start a new round of negotiations with the management.
Net liquidity remained strained at negative €160.6 billion compared to negative €147.4 billion at the end of last year.
Volkswagen maintained its recently lowered 2024 guidance, expecting a profit margin of around 5.6% and a 0.7% drop in sales to €320 billion.
The company’s operating margin decreased to 3.6% from 6.2%, further straining its performance targets.
“Our nine-month results reflect a challenging market environment and underline the importance of delivering on the performance programs we have launched across the Group,” said Volkswagen Group CFO and COO Arno Antlitz.
Operating profit for the third quarter fell 42% to €2.86 billion, and vehicle sales declined by 8.3% compared to the same period last year.
Earlier this week, Volkswagen said it plans to close at least three manufacturing plants in Germany and lay off tens of thousands of workers, according to the company’s works council.
The company is also aiming for a 10% pay cut for employees at the core VW brand as it grapples with rising fixed costs and operational inefficiencies. However, unions have opposed these measures, calling instead for a 7% wage increase.
Written by Cláudio Afonso | LinkedIn | X
