Volkswagen Takes New Hits: A Profit Warning Followed by Euro Stoxx 50 Exit
Volkswagen‘s troubles deepened Monday as the German auto giant was removed from one of Europe’s most prominent blue-chip indexes, just days after issuing another profit warning amid mounting pressure from China, restructuring costs and the accelerating transition to electric vehicles.
Volkswagen shares fell over 1.5% on Monday, extending losses after tumbling 8.3% on Friday. The selloff followed the automaker’s decision to sharply lower its 2026 profitability outlook.
The company now expects an operating return on sales of up to 1%, compared with its previous forecast of between 4% and 5.5%. Volkswagen said approximately 10 billion euros in special effects are expected to weigh on operating profit this year.
The revised outlook represents a significant reversal from July, when Volkswagen was still projecting a full-year operating margin of between 4% and 5.5%. At the time, the company reported first-half revenue of 158.1 billion euros and operating profit of 5.9 billion euros, while vehicle deliveries outside China had increased.
Among the biggest factors behind the new warning is a roughly 6 billion euro non-cash impairment of goodwill tied to Volkswagen’s Porsche business. The company also expects approximately 2 billion euros in additional restructuring expenses and impairments related partly to its operations in China.
Volkswagen specifically pointed to a worsening market environment in China and a faster shift toward battery-electric vehicles, saying the changes would cause performance at Audi and Volkswagen Passenger Cars to fall short of previous expectations.
China has become an increasingly difficult battleground for European automakers as domestic manufacturers expand their electric vehicle offerings and compete aggressively on technology and price.
Volkswagen said in July that its deliveries in China had fallen 20% during the first half of the year. The financial warning was followed Monday by Volkswagen’s preferred shares officially leaving the Euro Stoxx 50, the benchmark tracking major companies across the euro area.
The change had been announced by index provider STOXX earlier this month as part of its annual review and became effective when European markets opened on Sept. 21. Volkswagen was replaced by Finnish telecommunications equipment company Nokia. French utility Engie was also added to the index, replacing Dutch information services company Wolters Kluwer.
The removal comes as Volkswagen’s share price has fallen roughly 27.5% in 2026, leaving the stock near levels not seen since 2010. The automaker is simultaneously pursuing a sweeping restructuring intended to reduce costs and simplify its operations as it confronts weaker profitability, Chinese competition, tariffs and the costly transition toward electric vehicles.
Volkswagen itself said that excluding the roughly 10 billion euros in special effects, its 2026 operating return on sales would be approximately 4%, around the bottom of its previous guidance.
The company continues to forecast automotive net cash flow of between 3 billion and 6 billion euros and net liquidity of 32 billion to 34 billion euros. “We have no time to lose,” Volkswagen CFO and COO Arno Antlitz said after the revised guidance, arguing that the company must further reduce complexity and costs while accelerating its transformation.
