BERLIN (AP) — Volkswagen released disappointing sales figures on Friday, one day after the major German automaker unveiled a sweeping restructuring plan that includes cutting its vehicle model lineup by nearly half amid a sharp decline in sales, especially in China.
The company, headquartered in Wolfsburg, Germany, reported that group-wide sales dropped 8.6% during the second quarter to just under 2.1 million vehicles. Sales in China alone collapsed by more than one-third during that period.
Following a board meeting on Thursday, Volkswagen announced that its ongoing “fundamental realignment” — now in its third year — had entered a new phase. The automaker said it intends to simplify its model offerings by up to 50%, though no specific details were provided.
CEO Oliver Blume outlined a strategy aimed at making the company faster and more competitive. His plan focuses on reducing complexity, honing in on key technologies, better coordinating across regional markets, and cutting excess production capacity. Blume pointed to an “increasingly demanding environment” as the driving force behind the changes.
Looking at individual brands, the core Volkswagen nameplate delivered just over 1 million vehicles in the second quarter — a 14% decline compared to the same period last year. Audi deliveries fell 8%, while Porsche saw an even steeper drop of 18%.
Not all brands struggled, however. Lamborghini, Skoda, and the company’s trucks division all reported sales increases. Sales also grew in both the Americas and Europe.
Volkswagen pointed to a turbulent year marked by geopolitical tensions, higher costs driven largely by tariffs, tighter regulatory requirements, and intensifying competition as factors weighing on its performance.
As recently as December, the automaker had been making major bets on the Chinese market, where electric vehicles have been rapidly gaining ground and competition has grown fierce.
Research firm BernsteinSG responded to Thursday’s announcement with skepticism. “VW stated that it is extending its technology leadership, a claim that will likely raise eyebrows given the pace of innovation among its Chinese competitors,” the firm wrote in a note.
Also on Thursday, hundreds of workers staged a protest outside Volkswagen’s plant in Zwickau, demanding job protections and pushing back against plans to shut down the facility. The factory had already fully transitioned to producing electric vehicles.
