Volkswagen dipped about 0.5% in mid-morning trading on Monday, adding to Friday's 8.3% drop. The share price is down 27.5% year to date and hovering near lows last seen in 2010.
The stock was recently quoted at 75.08 euros, off 1.44 euros or 1.88% as of 4:17 PM CEST. The listing notes that pricing data is delayed. Finland's Nokia took the vacant spot.
Volkswagen trimmed its outlook for operating return on sales to 1%, down from a prior target range of 4% to 5.5%. The company pointed to an impairment tied to its significant Porsche holding, a further worsening market backdrop with particular pressure in China, and restructuring costs.
The company also warned that quicker customer migration to battery-electric models will cause results to miss prior expectations, with the Audi and Volkswagen Passenger Cars divisions feeling it most.
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Deutsche Bank called the warning initially severe, but argued it overstates the underlying damage. Analysts there said the update entails 10 billion euros in one-off items that will impact this year's earnings, while underlying margins are roughly 4% and the company's cash generation is still solid.
VW's removal from the Euro Stoxx 50 highlights the strain on European carmakers, grappling with rising expenses, fiercer global rivals, and the push to meet rapidly shifting appetite for EVs and hybrid models. The owner of Jeep and Dodge, Stellantis, exited the blue-chip benchmark a year ago as it dealt with challenges and a restructuring effort.
Index removal can change who buys and sells a stock, and a lower profit outlook narrows the margin for error. VW also just cleared the next step of a major reorganization and streamlining push that will cut 100,000 jobs, even as management works through this year's 10 billion euros in one-off effects. If you are watching the automakers, the mix of EV demand shifts, China exposure, and index status is what will likely drive how bumpy the ride gets from here.
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