Brand Group Core records higher unit sales and sales revenue – special factors impact profitability

Review Q1 / 2025

The Brand Group Core recorded successful market launches and a significant rise in the sale of all-electric models in the first quarter of 2025, thereby demonstrating its strength and adaptability in a highly demanding market environment.

The successful introduction of new models such as the Volkswagen Tayron and the Škoda Elroq further strengthened the portfolio and underscored the brands’ ability to serve customers’ needs and requirements.

Overall, the start to the year was influenced by the negative effects of CO₂ regulations in Europe, import duties in the United States, and costs relating to the diesel issue.

Outlook
Despite the present challenges, the Brand Group Core is steadily growing closer together – in the coming years, the brand group will focus on consistently increasing efficiency by expanding cooperation in jointly-agreed strategic fields of action.

Going forward, the brand group’s global production network of 22 locations will be organized in five production regions with a view to fostering stronger networking. Production will be more efficient and future-oriented, and cross-brand synergies and regional cost advantages will be leveraged.

The number of country clusters for technical development will also be reduced across all brands. Market requirements and customer wishes will be taken into account more effectively and efficiently in future. Furthermore, development times for new vehicles will be shortened to enable a faster response to market changes.

Cooperation among the volume brands on the “Electric Urban Car Family” project is proceeding as planned. Under the project led by Seat/CUPRA, the Brand Group Core will be launching electric cars in the 25,000-euro class from 2026. The four planned models – two from the Volkswagen brand and one each from CUPRA and Škoda – will be built at the Spanish plants in Martorell and Pamplona. Collaboration on the “Electric Urban Car Family” project alone will unlock synergy potential at brand group level totaling 650 million euros across the entire product life cycle.

The “Zukunft Volkswagen” program agreed at the end of last year laid the foundation for the competitiveness of Volkswagen AG in Germany. The program combines economic stability and sustainable employment. It paves the way for the Volkswagen brand as the main pillar of the Brand Group Core to become the global technologically leading volume manufacturer by 2030.

That is why the Brand Group Core is targeting continuous increases in earnings in the coming years, underpinned by the effects of the ongoing performance programs at all volume brands. Intensive efforts are already underway to implement the measures that have been decided – and thus generate a pathway to a medium-term return on sales of 8% for the Brand Group Core.

Overview of the brands in the Brand Group Core

Volkswagen Passenger Cars
Volkswagen Passenger Cars delivered 726,267 vehicles (excluding China, including external manufacturing) in the first quarter of 2025, a year-on-year increase of 4.6%. This trend was in part attributable to an upswing in sales of the ID.4, ID.7, T-Cross and Tiguan and the successful market launch of the Tayron. Sales revenue ran at 21.2 billion euros, an increase of 10.2% over the comparable prior-year period. The operating result fell by 84.9% to 112 million euros, with the decrease especially attributable to special items. In particular, provisions in connection with CO₂ regulations in Europe had a negative impact on the result. Other adverse factors were litigation costs in connection with the diesel issue and expenses from the measurement of vehicles in transit due to import duties introduced in the United States from the beginning of April. As a result, the operating margin of the Volkswagen brand fell significantly to 0.5% compared with 3.9% in the previous year.

Škoda Auto
In the first quarter of 2025, Škoda Auto Group was able to build on the successes of the 2024 financial year– the best ever in its history. Škoda delivered 238,600 vehicles in Q1 2025, an increase of 8.2% compared with the same prior-year period. At 36,900 units, deliveries of all-electric and plug-in hybrid models more than doubled. Driven by higher demand, the broad and modern model range and consistent cost optimization under the Next Level Efficiency+ program, the brand generated sales revenue of 7.259 billion euros (+10.4%). The operating result increased to 546 million euros, with a stable operating margin of 7.5%.

SEAT/CUPRA
SEAT S.A. generated sales revenue of 3.895 billion euros in Q1/25, 2.4&% higher than Q1/24 (3.803 billion euros). At the same time, SEAT S.A. reported an operating result of 5 million euros in Q1/25, a decrease of 221 million euros compared to the same prior-year period (Q1 2024: 226 million euros). This decrease is due to several factors, e.g. a shift in the sales mix towards BEV models, and European import duties on the CUPRA Tavascan produced in China. Further pressure came from a complex global environment and more intense competition, in particular on key markets for BEV models. The operating margin dropped to 0.1 %, a decrease of 5.8 percentage points compared with Q1 2024.

Volkswagen Commercial Vehicles
Volkswagen Commercial Vehicles (VWN) delivered 108,721 vehicles in the first quarter of 2025 – a decrease of 10.8% compared with the same prior-year period. This was chiefly attributable to the planned model changeover to the new Transporter, that has now joined the Multivan and the ID. Buzz to complete the “Bus Trio”. At 4.1 billion euros, sales revenue was similar to the prior-year level (-0.,8%). The operating result fell by 91% to 37 million euros. The operating margin was 0.9%, 8.6 percentage points lower than the prior-year value.

Key figures for the Brand Group Core:

Key figures for the brands belonging to the Brand Group Core: