Volkswagen Lowers Guidance Again as Demand Weakens

Volkswagen AG has significantly revised its sales and profitability forecasts for the year, citing a decline in vehicle demand and a sluggish global economic environment.

The company now anticipates sales to reach approximately €320 billion, a decrease from €322.3 billion the previous year. Deliveries are expected to be around 9 million vehicles, down from 9.24 million last year. Previously, Volkswagen had forecasted an increase in sales of up to 5% and a 3% rise in deliveries.

This adjustment is largely due to weaker demand for its core brands, including Volkswagen Passenger Cars and Volkswagen Commercial Vehicles. Additionally, the company pointed to a challenging macroeconomic climate that has further impacted demand.

The operating return on sales, a crucial indicator of profitability, is now projected to be around 5.6% for the year, which is below the earlier guidance range of 6.5% to 7%.

Volkswagen has also reduced its net cash flow forecast for its automotive division to about €2 billion, down from a previous estimate of €2.5 billion to €4.5 billion.

The company plans to announce its interim results as of September 30, 2024, on October 30.