Volkswagen, Europe's top carmaker, expects an operating margin of 5.5-6.5% in 2025, from 5.9% in 2024, it said, joining rivals in giving a muted outlook for the year ahead as the sector battles weak demand, high costs and simmering trade tensions.
Volkswagen's shares have fallen by over 40% in the past four years, also hit by a slower-than-expected ramp-up of electric vehicle production, major pricing pressure in top market China and Asian rivals entering the European market.
"We have strong brands, great products and a global scale. In view of these advantages, we cannot be satisfied with this financial outlook," finance chief Arno Antlitz said on Tuesday according to a speech manuscript shared in advance.
"It reflects the current challenges in the global economy and an industry that is in the midst of a fundamental transformation."
The outlook for 2025 does not factor in the possible impact of trade tariffs threatened by U.S. President Donald Trump on imports from Mexico or Europe, Antlitz said.
The group proposed a dividend of 6.36 euros per preference share for 2024, down from 9.06 euros paid out for the previous year, reflecting ongoing savings efforts following major job and capacity cuts announced in December.
Its operating profit fell 15% in 2024 to 19.1 billion euros ($20.8 billion) on revenue of 324 billion euros, in line with estimates by an LSEG poll, after the carmaker cut its outlook twice last year because of weaker-than-expected sales at its passenger car brand.
($1 = 0.9203 euros)
