Volkswagen Group records sales decline in second quarter – China sales plunge 36.6 percent

China as a problem child

In Western Europe, however, the core brand grew slightly: Volkswagen delivered just over 900,000 vehicles there, "nearly 2 percent more than a year earlier" – an increase of almost 2 percent. In North and South America as well as in other parts of Europe, the Group also recorded gains, "while there were particularly gains in North and South America and also in Europe."

The balance sheet for the Group brands was mixed. Audi delivered 367,139 vehicles, a decline of 8.2 percent. Porsche recorded an even sharper drop of 18 percent with 61,300 sports cars and SUVs; in the first half of the year, the decline amounted to 16 percent. Skoda, on the other hand, managed a slight increase, selling just under 284,000 vehicles – a gain of almost 5 percent.

Electric cars as a bright spot

The electric car business in Europe remains a bright spot. As Audi Board Member for Sales Marco Schubert explained, "nearly one-third of Volkswagen's European order backlog now consists of pure battery-electric vehicles". Orders for pure electric vehicles in Europe had risen by more than 50 percent compared to the end of the previous year. Deliveries of electric cars in Europe climbed by just under 6 percent in the quarter to just over 200,000 vehicles.

The weakness of European manufacturers is also reflected among competitors. BMW delivered 590,962 vehicles in the second quarter – a decline of 4.9 percent. Mercedes-Benz reported a decrease of 6 percent to 511,900 vehicles. Only Mini managed to buck the trend: The brand increased its deliveries by 17 percent to 81,035 vehicles.

Industry under pressure: Costs and tariffs

Hildegard Müller, President of the German Association of the Automotive Industry (VDA), sees structural problems as a contributing cause of the crisis. "Unsere Kostenstruktur hier ist im Vergleich zu anderen Produktionsstandorten schon in Europa oftmals viel zu teuer. Und deshalb braucht es konsequente Reformen", she said. With the "Kostenrucksack" that Germany carries, "gehe kein Weg an Reformen vorbei - das wisse die Politik auch schon lange", Müller continued.

The industry is additionally burdened by the international trade conflict. As the report shows, European automakers are affected by new tariffs imposed by US President Donald Trump. These additional burdens come on top of the already difficult market conditions in China.

Analysts divided on VW preferred stock

On the financial markets, Volkswagen's preferred stock was rated differently on the day of publication. JP Morgan Chase & Co. rated the stock "Neutral" at 09:26 a.m., while Jefferies & Company Inc. had already issued a "Buy" recommendation at 08:01 a.m. Previously, UBS AG had rated it "Neutral" on 29 June 2026 and RBC Capital Markets had said "Outperform" on 27 June 2026.

Marco Schubert, who as Audi Board Member for Sales is also responsible for the sales function for the entire Volkswagen Group, sees a glimmer of hope in the growing electric demand in Europe. If the high share of e-orders can be converted into actual deliveries, this could stabilize the Group in the coming quarters – provided the Chinese market has reached its trough.