Volkswagen expressed confidence in its 2025 guidance, which does not account for the potential impact of U.S. tariffs.
- In the earnings call, CFO Arno Antlitz expressed confidence in the 2025 guidance, citing a strong order bank and intake driven by new product launches, as well as the ongoing execution of performance programs (minute 16:30).
- The order bank in Western Europe stood at 1 million units in Q1, while order intake rose 29% year over year. Antlitz noted that current order intake extends into Q3 (minute 16:30).
- Antlitz said the €600 million CO2 provision does not factor in proposed legislative changes from the EU Commission. He added that if the current regulation remains unchanged, the provision would cover the full year; otherwise, the required amount could be slightly lower. However, he remains cautious given the ongoing volatility and uncertainty in the regulatory framework (minute 1:17:04).
- Antlitz also said he was pleased with the performance of the China team, particularly in the areas of technology, product development, and innovation (minute 15:10).
Assessment
While Volkswagen Group’s guidance excludes the impact of U.S. tariffs—which I estimate at €2.9 to €6.2 billion (weighted: €3.4 billion), it is noteworthy that the company is maintaining its guidance, whereas peers such as GM, Mercedes-Benz, Stellantis, and Volvo have suspended theirs, citing macro uncertainty. This suggests that Volkswagen may revise its guidance in the near future. Therefore, I will treat their guidance with some caution.
What I appreciated in the earnings call were management’s comments signaling that the China strategy is on track, the CO2 headwind has become minimal due to a growing BEV share, and that performance programs are progressing as planned and helping offset the margin dilution from BEVs.