Volkswagen Posts Nearly €6 Billion Quarterly Loss, Its Worst in Over a Decade

Volkswagen reported a €5.82 billion net loss in the third quarter of 2026, its worst quarterly result in more than a decade, as a multibillion-euro goodwill impairment at Porsche compounded falling sales in China and mounting restructuring costs, according to the company's nine-month results released on Thursday.

The German automaker recorded an operating loss of €5.86 billion between July and September, compared with a €1.3 billion operating loss in the same period last year. The net loss compares with a loss of about €1.07 billion a year earlier. Reuters reported, citing a company spokesperson, that it was the group's largest quarterly deficit since the fourth quarter of 2015, when "Dieselgate" charges hit.

Revenue fell 6.3% to €75.3 billion, while deliveries to customers declined 14.3% to about 1.89 million vehicles.

Porsche Writedown Drives Quarterly Loss

The largest factor behind the loss was a €6.4 billion non-cash impairment of goodwill related to Porsche. The charge reflected lower expectations for the sports-car subsidiary's future performance, according to German news agency DPA.

Volkswagen booked about €7.8 billion in special items during the quarter, most of the €8.7 billion recorded over the first nine months of 2026. Beyond Porsche, they included roughly €1 billion in impairments on assets of fully consolidated companies in China and extra costs tied to the planned sale of its Osnabrück plant.

The charges pushed the group's operating margin to minus 7.8% in the quarter, from minus 1.6% a year earlier. Volkswagen also pointed to weak market conditions in China, global pricing and competitive pressure, U.S. tariffs and a rising share of lower-margin electric vehicles, which it currently earns less on than combustion-engine cars.

Porsche itself remained profitable in the first nine months, with an operating result of €1.5 billion, according to Volkswagen.

China Deliveries Fall Nearly 40%

Volkswagen's performance in China deteriorated sharply. Deliveries there fell 38.5% year on year to about 405,800 vehicles in the third quarter. Over the first nine months, China deliveries fell 30.2% to about 1.38 million.

Growth in Europe and South America failed to offset the slump in China, where Volkswagen faces a shrinking market, price pressure and competition from domestic manufacturers. Worldwide, vehicle sales fell 11% to 5.9 million units in January–September, while deliveries to customers fell 9% to about 6.0 million.

Nine-Month Operating Profit Nearly Eliminated

The third-quarter loss pushed Volkswagen into negative earnings for the first nine months. The group reported a net loss of €2.72 billion for January–September, compared with a profit of about €3.4 billion in the same period of 2025.

Operating profit fell 98.7% to €71 million, from €5.41 billion a year earlier. Nine-month revenue fell 2.2% to €233.4 billion.

Excluding special items, the operating result was €8.8 billion, a margin of 3.8%. Chief financial officer Arno Antlitz said that level is "too low to continue investing strongly in our future." Volkswagen's automotive division generated net cash flow of €4.4 billion, up from €1.8 billion a year earlier.

Volkswagen Accelerates Restructuring

The results raise pressure on Volkswagen to deliver its cost-cutting program. In September, the supervisory board approved a sweeping restructuring plan under chief executive Oliver Blume.

According to Reuters, the plan adds about 50,000 job cuts worldwide on top of 50,000 already under way, bringing the total to around 100,000. Volkswagen's plan currently has no model allocation for four German plants — Emden, Zwickau, Hanover and Audi's Neckarsulm — for 2031–2034, and the company says it will develop alternatives for those sites over the next six to 12 months. Employee representatives had resisted the plan.

Volkswagen has also reportedly planned a global pay freeze for 660,000 workers until 2030. The company describes its Future Plan as a comprehensive cost program of around €31 billion.

The restructuring comes as Germany's industrial base shrinks. Chancellor Friedrich Merz has admitted the country is losing industrial jobs on a large scale.

Full-Year Profit Forecast Remains Under Pressure

Volkswagen expects 2026 revenue of about €315 billion and an operating return on sales of up to 1%. The forecast was cut in mid-September from a previous range of 4% to 5.5%.

"The nine-month results make one thing clear: We cannot afford to lose any time and must act quickly and decisively," Antlitz said.

The Porsche impairment is not an immediate cash outflow, but Volkswagen still faces falling deliveries, restructuring expenses and weaker profitability. Its shares were already near 10-year lows, Reuters reported. They fell about 2% initially on Thursday, but German market reports later showed the preferred shares trading roughly 2% higher in Xetra trading.