Volkswagen AG Slashes Profitability Forecast Amid Sliding Passenger Vehicle Demand and Transition to Electric Vehicles.
Volkswagen AG has once again revised its profitability forecast downwards for the second time this year, highlighting the turbulent transition into electric vehicles. Germany’s economy is struggling or possibly already in recession, with the difficulties felt across the automotive sector. The economic slowdown in China has also increased pressure on vehicle sales for luxury German automakers.
The renowned German car manufacturer, known for producing brands such as Audi, Bentley, Cupra, Jetta, Lamborghini, Porsche, SEAT, Škoda, and Volkswagen, announced on Friday that its forecast for operating return on sales – a key measure of profitability – had been reduced to 5.6%, down from a July estimate of 7. VW’s reduction in expectations was partly due to anticipated closure costs at an Audi plant in Belgium.
Bloomberg provided an overview of Volkswagen’s updated full-year guidance.
Volkswagen has been grappling with various issues, including slowing Chinese vehicle demand, increasing competition in the electric vehicles market, and a deteriorating macroeconomic environment.
Our latest report on Volkswagen presents a gloomy outlook for the traditional automaker.
Then there’s this.
Across Europe, vehicle sales are experiencing significant declines.
The downturn in EVs is putting carmakers like VW and Renault SA at risk of heavy fines as stricter European Union fleet-emissions rules are set to come into effect next year,” recently noted Bloomberg.
What is crucial to understand is the impact of ‘green’ (de-growth) policies pushed by elected and unelected far-left progressive officials, which undermine Western economies, essentially making companies unable to compete in Asia. In China, energy is abundant and cheap, unlike in Germany.
De-growth (climate) policies are suffocating Western companies, while China constructs new coal plants at six times the rate of any other country, supplying its manufacturers with an abundance of cheap energy. How can the West possibly compete? The answer is. they can’t.
