German auto giant Volkswagen reported a 15% decline in annual operating profit year-over-year, citing rising costs and expenses related to its ongoing restructuring efforts. Despite the profit drop, the German automaker posted a slight increase in revenue and maintained a positive outlook for 2025.
The company recorded a full-year revenue of 324.7 billion euros ($352.8 billion), up from 322.3 billion euros in 2023. It expects sales revenue to grow by up to 5% in 2025. Volkswagen’s operating margin stood at 5.9% for 2024, with projections ranging between 5.5% and 6.5% for this year.
However, vehicle sales declined by 3.5% in 2024, still the company described its results as solid, given the challenging market conditions. Following the announcement, Volkswagen shares were up 1.9% in early London trading on Tuesday.
Volkswagen also proposed a dividend cut of 30%, recommending payouts of 6.30 euros per ordinary share and 6.36 euros per preferred share at its annual meeting in May. Meanwhile, net liquidity in its automotive division fell 10.5% year-over-year to 36 billion euros, with forecasts placing liquidity between 34 billion and 37 billion euros in 2025.
Looking ahead, Volkswagen warned of several challenges in 2025, including geopolitical tensions, trade restrictions, increasing competition, volatile commodity prices, and stricter emissions regulations.
Speaking to CNBC, Volkswagen CFO Arno Antlitz acknowledged the company’s performance fell short of expectations but emphasized its strong brand portfolio and global scale. “With these prerequisites, we should be able to do more,” he said. Antlitz also pointed to the industry’s ongoing transformation as a key factor affecting financial performance.
Nevertheless, the automaker is dedicated to defending its 25% market share in Europe, maintaining its position in China, and expanding in the U.S. While Volkswagen is monitoring potential impacts from trade policies, Antlitz emphasizes its commitment to the American market.
