Volkswagen’s net profit plummeted by more than 30 per cent in 2024 compared to the previous year.
On March 11, the carmaker said profits from operating business in 2024 fell by 15.6 per cent, to €19 billion. After tax, there was a total decline of 30.4 per cent compared to 2023, with profits coming in at €12.4 billion.
“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 stated in a speech at VW’s headquarters in Wolfsburg.
“It reflects the current challenges in the global economy and an industry that is in the midst of a fundamental transformation,” he said, referring to the so-called “green” transition imposed by Brussels and backed by fines and penalties.
Major reasons for the drop in profits included higher operating costs and weaker sales, particularly in China, the firm said.
In 2024, car sales declined by 3.5 per cent, while production slipped by 3.8 per cent.
VW’s overall deliveries also fell, by 2.3 per cent compared to 2023, despite a 0.7 per cent increase in sales revenue, totalling €324.6 billion.
Company expenses increased.
VW has already been planning factory closures and wage cuts for its personnel.
Despite the latest performance, company workers covered by collective bargaining agreements will receive almost €4,800 in bonus payments for the past year, although from next year that will be reduced.
As part of the agreements reached in late December last year, it was decided that in 2026 and 2027, only the fixed advance payment element of nearly €1,900 — paid in November — would be retained.
The flexible portion, typically paid in May, would be suspended for two years. From 2028, the bonus was set to be gradually returned to its previous level by 2031.
In a show of solidarity with their employees, Volkswagen Group’s Board of Management has announced that members would forgo part of their collective multi-million-euro salaries.
VW CEO Oliver Blume and other board members said they would voluntarily waive 11 per cent of their salaries in 2025 and 2026, a Supervisory Board spokesperson confirmed.
Volkswagen’s recent shock announcement to cut tens of thousands of jobs, was not an isolated event but part of a much bigger crisis, according to Hildegard Müller, president of the German Association of the Automotive Industry. https://t.co/0nCR7UJKNx
— Brussels Signal (@brusselssignal) October 29, 2024
