Volkswagen’s profit dropped by a third in the first half of the year, the German auto giant said on Friday, dragged down by the tough market for electric cars and President Trump’s tariffs.
The carmaker was the latest in Europe to report a dent in earnings because of the 25 percent additional tariff imposed by Mr. Trump on cars imported to the United States, following Stellantis and Volvo Cars.
Volkswagen said that tariffs cost it 1.3 billion euros ($1.5 billion) in the first six months of the year, leading to a 33 percent decline in operating profit, to €6.7 billion. The company’s revenue was roughly the same as the previous year.
One bright spot was an increase in the number of cars delivered in Europe, where Volkswagen has overtaken Tesla as the market leader in electric vehicles.
Arno Antlitz, Volkswagen’s chief financial officer, said it was a “mixed picture,” citing the contrast between the resonance among car buyers for its newest models and the general challenges that are electric cars are facing, along with the drag of tariffs.
European carmakers have been squeezed since Mr. Trump imposed steep tariffs on imported vehicles. Automakers rely on global supply chains, making them vulnerable to increased import taxes. A 50 percent U.S. tariff on steel and aluminum — essential materials for car production — added further strain.
Volkswagen said that sales in North America dropped 16 percent in the first half of the year, largely because of the tariffs.
On Monday, Stellantis, which owns Chrysler and Jeep as well as the European brands Peugeot and Fiat, said that tariffs and factory shutdowns related to Mr. Trump’s trade policies contributed to a €2.3 billion loss in the first half of the year, with deliveries to U.S. buyers plunging 25 percent over that period.
Volvo Cars, which is based in Sweden but owned by China’s Geely Holding, reported a steep fall in profit in the second quarter. The company took an impairment charge of more than $1 billion on tariffs and production delays.
Mr. Trump and members of his administration have been adamant that they want to see foreign carmakers move production to the United States. Last week, Volvo said that it would move assembly of its best-selling model, the XC60 S.U.V., to its plant in Charleston, S.C., to reduce the impact of tariffs.
Volkswagen has a factory in Chattanooga, Tenn. and is investing $2 billion in a plant to make an updated version of Scout trucks, which will join Audi, Porsche and VW among the company’s brands. Volkswagen has also been exploring whether it could move production of some Audi models to the United States.
German automakers have played a key role in helping the European Union to lobby Washington for a reduction in Mr. Trump’s 25 percent auto tariffs, and have argued against the European bloc introducing retaliatory measures on U.S. goods shipped to Europe, arguing that they would be doubly penalized because they produce and export autos in both regions.
Some European automakers have called on Brussels to drop the 10 percent tariffs that the European Union currently imposes on cars made in the United States and imported into the bloc, saying that Europe’s industry does not need the protection. Last year, German automakers produced some 844,000 cars in the United States, roughly half of them for export.
Melissa Eddy is based in Berlin and reports on Germany’s politics, businesses and its economy.
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