VW Cuts 7,000 Jobs as Q1 Profit Tumbles Over US Trade Tensions

Volkswagen AG has implemented workforce reductions of approximately 7,000 positions across Germany since its late-2023 cost-saving efforts, according to Chief Financial Officer Arno Antlitz during an announcement following the firm’s unsatisfactory first-quarter results. The company registered a significant net profit decrease amounting to 40.6% with €2.19 billion ($2.49 billion) as revenue increased by 3% to €77.56 billion throughout the first quarter of 2025. Operating margins dropped to 3.7% in this period compared to 6% during the same period of last year.

Investors and analysts received the assurance from Antlitz that his team persists with complete determination to execute agreed-upon measures.

The profit decline stems from multiple challenges, including:

• Restructuring costs at its troubled software division
• EU fines for exceeding vehicle emissions standards
• Higher manufacturing expenses are cutting into margins
• Uncertainties surrounding US tariffs on imported vehicles

Volkswagen maintains its 2025 outlook but predicts business performance will reach the minimum end of its established guidance because of heightened market competition, together with unresolved trade disputes. Volkswagen has yet to include the US tariffs’ potential consequences when projecting sales growth to reach up to 5% levels.

Volkswagen delivers cars through North America as its third-largest business segment, amounting to more than 11% of Q1 vehicle distribution. A potential US-imposed 25% duty on imported vehicles threatens the entire business perspective of the automaker since it produces vehicles outside the United States.