Volkswagen sales slump as automaker pushes ahead with major overhaul

Volkswagen reported weaker sales figures on July 10 , a day after the German automotive giant unveiled plans to significantly reduce its model range in response to falling demand, particularly in China.

The Wolfsburg-based manufacturer said group deliveries dropped 8.6% year-on-year in the second quarter to just below 2.1 million vehicles, Caliber.Az reports, citing the AP.

Sales in China, its largest market, plunged by more than one-third during the period.

Following a board meeting on Thursday, the company announced that its three-year "fundamental realignment" program had entered a new phase, including plans to cut the number of models by as much as half, although no detailed breakdown was provided.

Chief Executive Oliver Blume outlined measures aimed at making the company more agile and competitive by simplifying operations, concentrating on core technologies, improving coordination across regional markets and reducing excess production capacity. He pointed to an "increasingly demanding environment" facing the industry.

Among the group's major brands, the core Volkswagen division delivered just over one million vehicles in the second quarter, marking a 14% decline from the same period last year. Deliveries at Audi fell 8%, while sales at Porsche dropped 18%.

In contrast, Lamborghini, Skoda and the group's truck division posted gains, while deliveries increased across Europe and the Americas.

Volkswagen cited a rapidly changing business environment over the past year, highlighting geopolitical tensions, higher costs linked largely to tariffs, tighter regulations and intensifying competition.

As recently as December, the automaker had continued to place strong emphasis on the Chinese market, where electric vehicles are capturing a growing share of sales and domestic rivals are increasing pressure on foreign manufacturers.

Research firm BernsteinSG questioned some of the company's claims following Thursday's announcement.

"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 noted.

Separately, hundreds of workers demonstrated outside Volkswagen's plant in Zwickau on Thursday, demanding stronger job guarantees and protesting against plans to shut the facility, which has been fully converted to electric vehicle production.

By Bakhtiyar Abbasov