Volkswagen reported $1.5 billion in third quarter operating losses, driven by ongoing financial pressure from Trump administration tariffs, as well as a pricey move away from electric vehicles for its Porsche brand. 

Volkswagen estimates that tariffs will cost the company more than $5.7 billion by the end of the year, and expects to take an additional $5.4 billion hit from the decision to move away from its all-electric strategy at Porsche. In an October 30 release, the automaker's CFO Arno Antlitz describe the first nine months of 2025 as a "mixed picture," where Volkswagen was hit with 15% tariffs from the U.S. and saw weakening sales in China, but was able to offset some of those losses thanks to strong demand for its vehicles in the European market. 

This also marked the first time Volkswagen has reported quarterly losses in five years.

"On the one hand, there is the market success of our combustion engine and electric vehicles, as well as good progress with restructuring," Antlitz explained, referring. "On the other hand, the financial result is significantly weaker compared to the previous year."

The automaker could also soon face a semiconductor shortage stemming from China's ban of exports from chip supplier Nexperia. China enacted the ban in early October, after the Dutch government took control of the company and suspended its Chinese CEO Xuezheng Zhang over national security concerns. Although the company is headquartered in the Netherlands, it's owned by Chinese company Wingtech, and roughly three-quarters of its chip output passes through two facilities in China — one in Shanghai and the other in Guangdong.

On October 29, a coalition of European automakers warned that assembly line stoppages "might only be days away" if the chip shortage is not addressed soon. 

“The industry is currently working through reserve stocks but supplies are rapidly dwindling," the coalition's director general Sigrid de Vries said. "We urge all involved to redouble their efforts to find a diplomatic way out of this critical situation."