Volkswagen Stock: Traton Forecasts Market Slowdown Amid Challenges

Volkswagen's commercial vehicle division Traton anticipates subdued market development in the coming year, projecting 2025 revenue growth between -5% and +5% with an operating margin of 7.5% to 8.5%. This cautious outlook follows persistent weakness in European markets, particularly Germany, which has already impacted previous results. Despite these headwinds, Traton achieved an adjusted operating margin of 9.2% last year, exceeding both its 2023 performance and internal forecasts. The company attributes this success to efficiency measures implemented while vehicle sales declined. Annual revenue remained stable at €47.47 billion, as did adjusted operating profit at €4.38 billion. These developments come as parent company Volkswagen undergoes comprehensive restructuring, planning thousands of job cuts in Germany due to shrinking European demand, intensifying Chinese competition, and uncertainties surrounding the transition to electric vehicles.

Financial Implications for Porsche Holding

The challenges facing the Volkswagen Group have severely impacted Porsche Automobil Holding SE, which reported a staggering after-tax loss of approximately €20 billion for the 2024 fiscal year. This figure includes a €19.9 billion writedown on its Volkswagen AG stake, reflecting the automotive sector's strained conditions. Additionally, Porsche SE devalued its Porsche AG holding by €3.4 billion. Despite these non-cash charges, the holding company still plans dividend distributions for fiscal year 2024. The group's net debt stands at approximately €5.2 billion, within forecasted parameters. These developments have naturally drawn significant attention from investors, with Volkswagen shares under particular scrutiny following these substantial impairment charges.