Volkswagen's Profit Targets Hang in the Balance as Chinese Chip Shortage Bites.
Germany's leading automaker Volkswagen has warned that its annual profit targets are at risk due to a shortage of crucial computer chips from China, leaving carmakers across Europe facing uncertainty about production and sales.
The German giant has been trying to mitigate the impact of dwindling supplies by launching new models and cutting costs, but its forecasts rely on "adequate availability of semiconductors." As chip supplies dwindle, VW is bracing itself for potential losses and a slowdown in deliveries to China.
Volkswagen's first nine months have seen 6.6 million cars sold, an increase of 1.8% year-over-year. However, the company has forecast an operating profit between 2% and 3%, but US trade tariffs are expected to cost €5 billion this year. These levies have hit VW's most popular cars hard.
Meanwhile, the European Automobile Manufacturers' Association has warned that carmakers may be days away from closing production lines due to the chip shortage. In 2021, a global shortage of chips related to the Covid pandemic disrupted car production worldwide.
Volkswagen is exploring ways to offset the impact of low semiconductors, including product launches like its latest electric vehicles. However, "the financial result is significantly weaker compared to the previous year," said Arno Antlitz, VW's chief financial officer. The company's restructuring efforts are underway, but it faces significant challenges ahead.
The chip shortage is not the only issue affecting Volkswagen. China has banned exports of rare earth minerals, which are used in electric vehicle batteries, putting pressure on carmakers worldwide. Meanwhile, a new ban on Chinese chips has sparked fears about global supply chains and the impact on industries that rely on semiconductors.
As tensions continue to simmer between the US and China, Stellantis – owner of Vauxhall and Jeep – reported a 13% jump in third-quarter revenue, driven by new product launches. The company's shares have been boosted by the turnaround under its new CEO, Antonio Filosa.
Germany's leading automaker Volkswagen has warned that its annual profit targets are at risk due to a shortage of crucial computer chips from China, leaving carmakers across Europe facing uncertainty about production and sales.
The German giant has been trying to mitigate the impact of dwindling supplies by launching new models and cutting costs, but its forecasts rely on "adequate availability of semiconductors." As chip supplies dwindle, VW is bracing itself for potential losses and a slowdown in deliveries to China.
Volkswagen's first nine months have seen 6.6 million cars sold, an increase of 1.8% year-over-year. However, the company has forecast an operating profit between 2% and 3%, but US trade tariffs are expected to cost €5 billion this year. These levies have hit VW's most popular cars hard.
Meanwhile, the European Automobile Manufacturers' Association has warned that carmakers may be days away from closing production lines due to the chip shortage. In 2021, a global shortage of chips related to the Covid pandemic disrupted car production worldwide.
Volkswagen is exploring ways to offset the impact of low semiconductors, including product launches like its latest electric vehicles. However, "the financial result is significantly weaker compared to the previous year," said Arno Antlitz, VW's chief financial officer. The company's restructuring efforts are underway, but it faces significant challenges ahead.
The chip shortage is not the only issue affecting Volkswagen. China has banned exports of rare earth minerals, which are used in electric vehicle batteries, putting pressure on carmakers worldwide. Meanwhile, a new ban on Chinese chips has sparked fears about global supply chains and the impact on industries that rely on semiconductors.
As tensions continue to simmer between the US and China, Stellantis – owner of Vauxhall and Jeep – reported a 13% jump in third-quarter revenue, driven by new product launches. The company's shares have been boosted by the turnaround under its new CEO, Antonio Filosa.
this is so bad for vw they were doing ok but now they gotta deal with chip shortage 
and us trade tariffs too... 6.6 million cars sold in first 9 months is a lot tho 
but it's not enough i guess... 2-3% operating profit forecast isn't very inspiring 
arno antlitz saying financial result is weaker this year 
Volkswagen's problems are like us struggling to declutter our digital life - too much stuff (chips) and not enough space 
. They're trying to cut costs and launch new models, but it's hard when the essential parts just aren't available 
. The European auto industry is feeling the squeeze, and I hope they can figure out a way to get production back on track 
. Maybe this is an opportunity for them to rethink their supply chain and go digital? 
i'm telling u, this chip shortage thing is gettin CRAZY!!! vW's profit targets are at risk? that's like, a big deal! they're not just worried about europe, they're thinkin bout the whole world. 6.6 million cars sold in 9 months? that's awesome, but €5 billion in US trade tariffs is a BIG hit. and now stellantis is doin better than vW? that's like, the ultimate double whammy! 
what's next?? 
they're doing everything they can to mitigate the impact, like launching new models and cutting costs 
and let's be real, electric vehicles are the future, so even if they're not producing as many cars as usual, it's still a solid investment for their long-term growth 
. we need to figure out a solution to this before it's too late 
stellantis tho seems to be doing alright with their 13% jump in revenue lol, guess u can't have a bad quarter if ur CEO is antonio filosa 
anyway, gotta keep an eye on this situation because its def not over yet...
like what happened with covid, we should've invested more in our own tech instead of relying on other countries for everything 
. This is what I call a perfect storm of global trade tensions 
. And don't even get me started on how this affects our economy - if car production slows down due to semiconductors, that means fewer jobs and less economic growth 
. i mean, VW's trying to diversify and cut costs, but the chip shortage is still gonna bite them hard 
these trade tariffs are killin them rn €5billion is no joke and the us has got the last laugh 
u can say stellantis is gettin away with it tho 13% jump in revenue lol vw needs 2 step up their game ASAP 
It's crazy that carmakers are having to close production lines due to the chip shortage 
. Can't we just get some common sense and work together to solve this problem? 
. The US trade tariffs are also whackin' their sales hard 
. And it's not just VW, the whole European industry is in a mess 
or else we might see some major production line closures