The Brand Group Core – comprising Volkswagen, Škoda, SEAT/CUPRA, and Volkswagen Commercial Vehicles – reported a strong start to 2025, with sales revenue rising to €35.3 billion in the first quarter, driven by robust demand for all-electric models and successful new product launches.
However, despite this solid topline performance, the operating result declined to €1.12 billion, impacted by several external challenges:
- Provisions related to CO₂ regulations in Europe
- Costs associated with the diesel issue
- Inventory write-downs following newly announced U.S. import duties
These factors weighed on overall profitability, although the Group demonstrated strong adaptability in a volatile market.
Strong Electric Momentum and Portfolio Expansion
The first quarter saw the successful market introduction of key new models such as the Volkswagen Tayron and Škoda Elroq, reinforcing the Group’s product portfolio and responsiveness to evolving customer needs. All brands recorded a significant increase in electric vehicle (EV) deliveries, highlighting their growing share within the Group’s sales mix.
Strategic Outlook: Integration, Efficiency, and Innovation
Looking ahead, the Brand Group Core is focused on deepening integration and improving efficiency across all volume brands through coordinated strategic initiatives:
- The global production network will be reorganized into five regional hubs, promoting stronger cross-brand cooperation, enhanced efficiency, and local cost advantages.
- Technical development will be streamlined through a reduction in country clusters, enabling faster response times to market demands and more efficient product development cycles.
- The Group aims to shorten vehicle development timelines and better align offerings with customer expectations worldwide.
Electric Urban Car Project: Affordable EVs from 2026
Progress continues on the “Electric Urban Car Family” project, led by SEAT/CUPRA, which will launch four compact electric vehicles priced around €25,000 starting in 2026. These models – two from Volkswagen, one from Škoda, and one from CUPRA – will be produced in Martorell and Pamplona, Spain.
This collaboration is expected to unlock €650 million in synergies across the product lifecycle.
Zukunft Volkswagen and Path to 8% Return on Sales
The Zukunft Volkswagen program, launched at the end of last year, lays the groundwork for long-term competitiveness, combining economic resilience with sustainable employment in Germany. It supports the Volkswagen brand’s ambition to become the global leader in technology among volume manufacturers by 2030.
With ongoing performance and efficiency programs being implemented across all brands, the Group is targeting steady earnings growth and a medium-term return on sales of 8% for the Brand Group Core.
“The Brand Group Core held its own in a challenging first quarter with increases in unit sales and sales revenue. Convincing market launches and higher deliveries of all-electric models acted as a counterbalance to negative external factors” said David Powels, Member of the Board of Management of the Volkswagen Brand responsible for “Finance” and responsible for Finance at the Brand Group Core. “These external challenges show that we must keep up the vigorous pursuit of our performance programs in the brands. We continue to work on lowering battery costs, reducing factory costs and overheads, shortening development times, and improving software quality. This is how we are strengthening the resilience and competitiveness of our Brand Group Core.”
