Volkswagen cuts 2025 guidance after $1.5-billion tariff hit in first half
Reuters has reported that the German auto OEM booked billions of dollars of losses and has issued profit warnings due to US import tariffs. The European industry is also facing stiffening competition from China and domestic regulations aimed at speeding up the electric vehicle transition. Volkswagen, which is the biggest carmaker in Europe, now expects the operating profit margin of 2025 to be between four and five per cent, compared with a previous forecast of 5.5 per cent to 6.5 per cent. Volkswagen's full-year sales, earlier seen up to five per cent higher, are expected to be level with the previous year.
Also check these Cars
Find more Cars
Volkswagen Taigun 1498 cc
1498 cc Petrol
Petrol
₹ 11.80 Lakhs
Compare
View Offers
UPCOMING Volkswagen Tera 998 cc
998 cc Petrol
Petrol
₹ 9 - 15 Lakhs
Alert Me When Launched
UPCOMING Volkswagen Polo 2025 999 cc
999 cc Petrol
Petrol
₹ 8 Lakhs
Alert Me When Launched
Volkswagen Virtus 1498 cc
1498 cc Petrol
Petrol
₹ 11.56 Lakhs
Compare
View Offers
Volkswagen Tiguan R-Line 1984 cc
1984 cc Petrol
Petrol
₹ 49 Lakhs
Compare
View Offers
UPCOMING Volkswagen ID.7 77 kWh
77 kWh 621 Km
621 Km
₹ 70 Lakhs
Alert Me When Launched
To cope with this situation, the automaker is aiming to accelerate its cost-cutting efforts, which have been planned in response to the tariffs. "We need to shift our cost efforts into high gear and accelerate implementation. After all, we cannot assume that the tariff situation is only temporary," said Volkswagen Group CEO Oliver Blume.
The company's earnings dropped by 29 per cent in the second quarter of this year owing to the tariffs. Volkswagen reported an operating profit of 3.8 billion euros in the quarter ended June 30, recording a 29 per cent slump compared to the previous year. The OEM has cited reasons like tariffs and restructuring costs, as well as higher sales of lower-margin all-electric models, for this slump in earnings.
While Volkswagen as a solo brand was able to boost its car deliveries globally by 1.5 per cent in the first six months of 2025, the group witnessed a decline of almost 10 per cent in deliveries to the US. Two of the luxury car brands under Volkswagen AG's umbrella, Porsche and Audi, are particularly exposed to US tariffs, given they have no production in the country, and rely heavily on exports.
Get insights into Upcoming Cars In India, Electric Vehicles, Upcoming Bikes in India and cutting-edge technology transforming the automotive landscape.
First Published Date:
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Time of India
11 minutes ago
- Time of India
MeitY wants tariff shield for electronics exports
Academy Empower your mind, elevate your skills India wants its fledgling electronics exports, dependent largely on the US markets for overseas earnings, to be treated differently from Washington-bound shipments from established global players, such as those based in China and Southeast Asia, when the Oval Office fixes tariffs for these product of electronics, lately undergirded by federal financial support in India, would require a relatively favourable tariff landscape to fill US retailing shelves against competition from established exporters from mainland China, Vietnam, Taiwan and Malaysia, said an official from the Ministry Electronics and Information Technology (MEITY)."The US is the largest destination for not only our overall electronics sector, but also for a range of individual electronic products,' said the official cited above. 'The large-scale production of many of these are now kicking in, due to government support over the past few years. It is crucial they don't face tariff barriers at this point, and we have communicated that to the Commerce Department."India's commerce ministry is at the vanguard of the ongoing Washington-New Delhi talks that would shape the final tariff landscape for bilateral trade. The MEITY official said it made the request to the commerce ministry for helping shield Indian electronics from the applicable continental tariffs dragnet during the recent inter-ministerial talks on the trade 2024, the United States imported a combined $478 billion of electrical machinery and electronics, according to the Observatory of Economic Complexity, an online repository of global trade data begun as a research project at the Massachusetts Institute of Technology. China (26.1 percent), Mexico (18 percent), Vietnam (8.8 percent), Taiwan (6.7 percent), and Malaysia (5.9 percent) made up the largest share of sectoral exports. Meanwhile, India was the 9th largest source of shipments, with a 3 percent a last-minute postponement, as was the case in early July, the US will levy 26% average tariffs on all goods imported from India beginning August 1, over and above a 10 percent baseline tariff imposed on most ' reciprocal tariffs ' initially announced by US President Donald Trump on April 2 would especially hit Indian electronics exports, which have historically had much lower or nil tariffs, officials said."While smartphones, computers, and semiconductors were temporarily exempted from the tariffs, the US had threatened separate, sector-specific tariffs on these until last month," said the official cited to the Commerce Department data, US-bound electronic exports stood at $15.89 billion in 2024-25, up 43.5 percent from $11.08 billion in the preceding year. Within this, smartphones and telecom instruments made up the largest chunk of exports at $10.56 billion, up from $5.56 billion in 2023-24. Smartphone exports shot up 89 percent in FY25, after rising 158 and 210 percent in FY24 and FY23, government is especially concerned about the second largest export sub-category within electronics, components, which tanked 32.7 percent to $1.81 billion in 2024-25, down from $2.69 billion in 2023-24. This is mostly due to a 43.85 percent slump in the export of photovoltaic cells (PVC) assembled in modules, or made up into panels, due to rising domestic production in the US, increasing competition by Chinese producers as well as increasing scrutiny of shipments from India and South East Asian countries at US ports to stop circumvention of Chinese goods, officials instruments exports stood at $1.4 billion, rising 12.10 percent from $1.25 billion in the preceding year. Also, computer hardware of $154.08 million was exported to the US, rising 51 percent from $101.5 million in 2023-24. Another area where the government hopes to raise exports is consumer electronics, which fell 5.3 percent in the latest year to $115 million.
&w=3840&q=100)
First Post
11 minutes ago
- First Post
'Substantial damage, submission': Germany, France react to Trump's 'huge deal' with EU
A new trade deal between EU chief Ursula von der Leyen and US President Donald Trump has drawn sharp criticism from France and Germany, with leaders warning it could hurt Europe's economy and undermine the bloc's independence read more German Chancellor Friedrich Merz and French President Emmanuel Macron hold talks in the library of the Villa Borsig, guesthouse of the German Foreign Ministry, in Berlin. AFP Leaders of Europe's two largest economies, France and Germany, have voiced strong criticism of the new trade deal reached between EU chief Ursula von der Leyen and US President Donald Trump. German Chancellor Friedrich Merz warned the agreement would 'substantially damage' the country's economy, while French Prime Minister François Bayrou said it amounted to 'submission'. The overall reaction across the EU has been gloomy, though some member states conceded that the deal, despite being unbalanced, was a necessary compromise to avoid a full-blown trade war. STORY CONTINUES BELOW THIS AD Under the agreement, a 15% tariff will be imposed on most EU exports to the US—significantly lower than the 30% initially threatened by Trump, in exchange for Europe increasing imports of American energy and cutting duties on certain US goods. EU chief says it is a 'huge deal' Following private talks at Trump's Turnberry golf course in Scotland, Ursula von der Leyen called the agreement a 'huge deal', while President Trump said it would bring the US and EU 'closer together'. The deal still requires approval from all 27 EU member states, each with differing economic priorities and varying reliance on exports to the US. Although no country has indicated an intention to block it, there was little celebration among European leaders. Chancellor Merz warned that both the US and EU economies would likely suffer negative impacts. However, he acknowledged the Brussels negotiating team had done all it could when facing a US president determined to reshape global trade relationships. Bayrou took aim at the agreement, writing on X: 'It is a dark day when an alliance of free peoples, brought together to affirm their common values and to defend their common interests, resigns itself to submission.'
Mint
41 minutes ago
- Mint
Best stocks to buy today, as recommended by Raja Venkatraman for 29 July
The continuous overhang of geopolitical events is keeping the trends suppressed, as the global cues still have a very deep overhang, leading to market confusion. As the trends ahead show that clarity will be something that defeats the current market trends, we need to find some encouraging triggers to arrest the bearish mindset in the days to come. Here are three stocks to buy or sell as recommended by Raja Venkatraman of NeoTrader for 29 July: SBILIFE: Buy CMP and dips to ₹1,810 | Stop ₹1,790 | Target ₹1,950-2,000 MANINFRA: Buy CMP and dips to ₹177 | Stop ₹174 | Target ₹190-195 MANORAMA: Buy CMP and dips to ₹1,640 | Stop ₹1,620 | Target ₹1,770-1,825 Market today Indian equity benchmarks started the week on a subdued note, marking the third straight session of declines on 28 July as selling pressure outweighed supportive global markets. The Nifty opened below 24,800 and, although it managed an initial recovery in the early hours, it failed to gain traction and slid beneath the 24,700 mark for the first time since 13 June amid broad-based selling across sectors barring pharmaceuticals. The Sensex closed down 572.07 points, or 0.70%, at 80,891.02, while the Nifty fell 156.10 points, or 0.63%, to end at 24,680.90. Meanwhile, the mid-cap and small-cap indices retreated 0.7% and 1.3%, respectively. Sectoral losses were widespread, with realty plunging nearly 4% and media shedding close to 3%. Capital goods, metals, telecom, PSU banks, and private banks each dropped between 1% and 1.5%, underscoring the prevailing risk-off sentiment. Investors remain cautious ahead of upcoming corporate earnings and key macroeconomic data due later in the week. Outlook for trading Broader indices were unable to contain the profit booking that emerged at the start of the week, dragging the market lower. Despite a rebound on the back of US President Donald Trump keeping us guessing about his next move, the markets are clearly unable to hold on to the rebound convincingly. While every attempt was made to keep the markets in positive territory, the intermittent decline continues to retest the bullish resolve. Right now, the pronounced volatility is causing some disturbance in forming the bias, thus making the markets jittery. Trends have remained muted until the negative vibes in the Nifty Bank persisted to dent our confidence. With the trends after breaching the channel, it is showing some continued bearish pressure, as we can see that the markets are suppressed and even show some bearish signs as we enter the last trading day of the week. With the result season in play, the expectation from the Q1 numbers will be keenly tracked. As we operate in an environment of ad-hoc triggers, the markets shall continue to oscillate over the next few days. A volatile environment is now part of the ever-changing market scenario, forcing the sentiment to keep changing. Risk management is critical, as the lack of clarity is greater than ever. However, there is still some value discovery happening in mid and small caps that demonstrates a bullish sentiment. Among them, the Trump Tariff Saga has the global markets oscillating. With no clarity on the outcome, we shall continue to oscillate in a range between 24500 and 25000 on the Nifty Spot. Three stocks to trade, recommended by NeoTrader's Raja Venkatraman: SBI Life Insurance Co. Ltd (Cmp: ₹1850.50) Why it's recommended: SBI Life Insurance, incorporated in October 2000, is a leading Indian life insurance company. It operates as a joint venture between the State Bank of India (SBI), India's largest commercial bank, and BNP Paribas Cardif S.A., the life and property and casualty insurance arm of BNP Paribas. Strong demand recovery in this stock from lower levels and the rebound from demand zones support price stability and growth potential. With prices trading close to the 52-week high, more room for upside is possible. Key metrics: P/E: 74.55 52-week high: ₹1,936, Volume: 1.18M. Technical analysis: Support at ₹1,730, resistance at ₹2,050. Risk factors: Dependence on trends in the insurance sector and raw material price volatility. Buy at: CMP and dips to ₹1,810. Target price: ₹1,950-2,000 in 1 month. Stop loss: ₹1,790. Man Infraconstruction Ltd (Cmp: ₹182.46) Why it's recommended: Signs of reversal from oversold zones signal potential upside. Demand at lower levels showcases optimism for recovery in the coming sessions. The daily charts indicate that the volume-based rise seen in the last few sessions augurs well for the prices. Key metrics: P/E: 46.88 52-week high: ₹262.50 Volume: 1.86M Technical analysis: Support at ₹165 | Resistance at ₹205. Risk factors: Declining revenue and profits, as well as a decrease in operating profit margin. Buy at: CMP and dips to ₹177. Target price: ₹190-195 in 1 month. Stop loss: ₹174. Manorama Industries Ltd (Cmp: ₹1687.70) Why it's recommended: Gradual accumulation at critical support levels highlights strong investor interest, supported by consistent revenue growth. Steady higher lows with a thrust above value area resistance around 300 suggest more upside possibility. Key metrics: P/E: 67.18 52-week high: ₹1,632 Volume: 118.49K Technical analysis: Support at ₹1,470 | Resistance at ₹1,850. Risk factors: Competition in the banking space and regulatory issues. Buy at: CMP and dips to 1640. Target price: ₹1,770-1,825 in 1 month. Stop loss: ₹1,620. Raja Venkatraman is co-founder, NeoTrader. His Sebi-registered research analyst registration no. is INH000016223. Investments in securities are subject to market risks. Read all the related documents carefully before investing. Registration granted by Sebi and certification from NISM in no way guarantees performance of the intermediary or provide any assurance of returns to investors. Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before making any investment decisions.
