On October 11, Volkswagen Group announced that its global sales for the third quarter had fallen by 7.1% year-on-year, reaching 2.176 million vehicles. In China, the world's largest car market, sales dropped 15% year-on-year to 711,500 vehicles. This highlights the significant challenges faced by the European automotive industry, including weakened demand in China and rising production costs in Europe.
In terms of electric vehicle (EV) sales, Volkswagen Group saw a 5.2% year-on-year increase in China in the third quarter, selling 57,500 EVs, driven by cost-cutting measures. However, on a global scale, Volkswagen Group's Q3 EV sales dropped 9.8% year-on-year to 189,400 units, with the U.S. market seeing a steep decline of 41.7%.
As the European Union imposes higher import tariffs on Chinese-made electric vehicles, European automakers like Volkswagen Group will have to navigate the escalating trade tensions between China and the EU.
As Europe's largest carmaker, Volkswagen Group is undergoing major reforms. Due to weak demand in Europe, fierce competition from Chinese automakers, the challenges posed by vehicle electrification, and high costs in Germany, Volkswagen is considering closing factories in Germany for the first time.
Marco Schubert, a member of Volkswagen Group's executive board, stated in a statement that cost reductions are crucial for the company's future success, especially in Germany.
Schubert also noted that Volkswagen Group faces particularly tough conditions in China, where it is under intense pressure from domestic competitors offering more affordable EVs, significantly squeezing its market share.
A spokesperson for Volkswagen Group added that the company has reduced the cost of producing electric vehicles in China. The spokesperson further stated that the company would not sacrifice profitability for market share.
Previously, Volkswagen Group lowered its full-year sales forecast for the second time in three months, expecting to deliver around 9 million vehicles this year, a slight decline compared to the previous year.
