Volkswagen Group shares rebound 4% after management said the guidance doesn’t include mitigating effects and environment for Volkswagen Group in Europe is stable
- In the earnings call, CFO Arno Antlitz pointed out that if the tariff were to fall to 15%, the operating return on sales target may end up at 4.5%.
- Antlitz said the guidance of between 4% and 5% doesn’t take into account US tariff mitigation effects such as price increases.
- Antlitz pointed out that the demand and pricing for Volkswagen Group is currently stable in Europe due to product momentum.
- Volkswagen sees strong potential in Robotaxis (forecasted $400B market) and expects to launch ID. Buzz AD in the US with Uber in 2026.
Q2 2025 Volkswagen earnings call summary (Wiki)
Assessment
Volkswagen shares rose by 4%, partly driven by indications that the company’s guidance does not yet reflect the potential mitigating effects of U.S. tariffs. There is also growing market optimism that the EU and U.S. might agree on a reduced tariff rate of 15%, which would make an operating margin of at least 4.5% achievable.
Analysts had been expecting a 2025 operating margin of 4.76%, so incorporating tariff mitigation could bring Volkswagen’s projected margin closer to this consensus.
Additionally, Volkswagen’s performance program at the Brand Group Core is showing positive results. In Q2 2025, the operating return on sales at the Brand Group Core improved to 6.3%, up from 3.2% in Q1. While Audi and Porsche weighed on overall profits, this was largely due to restructuring charges and elevated product costs.
Overall, the earnings call was more upbeat than prior commentary had suggested.