Volkswagen Adjusts Annual Outlook Amid Weakening Market Conditions

Volkswagen has downgraded its annual financial outlook for the second time in three months, citing weaker-than-expected performance in its passenger car division and a challenging macroeconomic environment. This adjustment follows similar moves by other major German automakers like Mercedes-Benz and BMW due to decreased demand from China.

Volkswagen announced on Friday that it has cut its annual financial outlook for the second time in less than three months, citing weaker-than-expected performance in its passenger car division and a deteriorating macroeconomic environment.

This revised outlook adds to a series of downgrades by Germany's automotive giants, including Mercedes-Benz and BMW, which have also reduced their annual forecasts recently due to declining demand in China. As a result, Europe's largest carmaker now anticipates a profit margin of around 5.6% in 2024, down from an earlier estimate of 6.5-7% and below the 6.5% forecasted by LSEG.

Volkswagen's sales are expected to decrease by 0.7% to 320 billion euros ($356.7 billion), a stark contrast to the previously expected increase of up to 5%. The company attributed the revised outlook to a challenging market environment and underperformance, particularly from its Volkswagen Passenger Cars, Volkswagen Commercial Vehicles, and Tech. Components brands.

(With inputs from agencies.)