Volkswagen's largest investor, Porsche SE, which holds 31.9% of VW's equity and 53.3% of its voting rights, has issued a stark warning to the German automaker. They stated that Volkswagen is at a "historic crossroads" and risks permanently losing ground to international competitors if it delays crucial decisions. The investor's message emphasizes the urgency for a radical overhaul, including potentially cutting up to 100,000 jobs, double the previously stated amount, to counter a profit slump and billions of euros in tariff costs, especially amid intensifying competition from Chinese car brands.
Hans Dieter Pötsch, chairman of the board of management of Porsche SE, and Johannes Lattwein, member of the board responsible for finance and IT, have stressed that "competitiveness is the goal" and "every option must be considered." They highlighted the imperative for Volkswagen to reduce excess capacity, significantly lower costs, and strengthen decision-making and execution. This warning comes as Porsche SE reported a 14.5% drop in adjusted half-year earnings after tax, reaching $1.1 billion (€949 million).
Volkswagen CEO Oliver Blume acknowledged the time-sensitive nature of the situation, stating, "What we do not have is time." He affirmed the company's clear strategy and plan to secure long-term competitiveness. Morningstar DBRS recently downgraded Volkswagen AG's Issuer Rating to BBB (high) from A (low) and changed the trend to Stable, citing significant industry challenges including profitability levels, aggressive competition in China, and trade policy impacts. This downgrade underscores the financial pressure on VW, with its stock down around 27% year-to-date. Volkswagen's CFO, Arno Antlitz, has indicated that while job cuts and plant closures are not goals in themselves, the company aims to reduce its cost structure, increase productivity, and improve capacity utilization.
