Volkswagen Brand Group Core (BGC) reported an operating result of 3.61 billion euros for the first half of 2026, marking a 4.5% increase from the same period a year earlier. The group also improved its operating margin to 4.9% despite ongoing pressure from U.S. import tariffs, geopolitical challenges, and an increasingly competitive global market.

Brand Group Core Improves Profit Despite Market Pressures

The Volkswagen Group said consistent cost control and stronger cooperation among its volume brands supported the improved half-year performance. At the same time, the company said geopolitical crises, expanding trade barriers, regulatory requirements, and market disruptions continue to affect markets and supply chains.

To respond to these challenges, the Brand Group Core aims to become more efficient and resilient by reducing costs and simplifying processes, organizational structures, and product complexity.

New Core Executive Committee Begins Work

At the beginning of July, the newly created Core Executive Committee (CEC) officially started operations. The committee includes Thomas Schäfer (Volkswagen), Klaus Zellmer (Škoda), Markus Haupt (SEAT&CUPRA), Stefan Mecha (Volkswagen Commercial Vehicles), along with David Powels (Finance), Karsten Schnake (Procurement), Christian Vollmer (Production), and Kai Grünitz (Technical Development).

The new structure introduces clearly defined responsibilities and greater regional accountability across Volkswagen Group’s volume brands.

Thomas Schäfer, Member of the Group Board of Management and CEO of the Volkswagen Passenger Cars Brand, said the first-half results demonstrate that cooperation across the brand group is producing measurable results.

“The results of the first half show that our cooperation as a brand group is effective and is targeted towards joint success. This approach is increasingly bearing fruit. Nevertheless, geopolitical crises and far-reaching market upheavals continue to have an adverse impact on our business,” Schäfer said.

He added that the new Core Executive Committee is intended to strengthen cooperation through clearer responsibilities, leaner management, and closer collaboration in production, procurement, and development.

CFO Highlights Cost Discipline and Long-Term Competitiveness

David Powels, CFO of the Volkswagen Passenger Cars Brand and Brand Group Core, said performance improvement programs helped offset special costs related to ending ID.4 production in North America while allowing the group to post a slightly stronger operating result than in the first half of 2025.

He said sales revenue increased at a slower pace than vehicle deliveries, reflecting a challenging economic environment and increasing competitive pressure. Powels also said Volkswagen plans to further improve competitiveness through 2030 by reducing costs, lowering complexity, and expanding cooperation across the brand group.

First-Half 2026 Performance

Brand Group Core said efficiency programs across its volume brands contributed to higher operating results, although overall performance remained below the group’s own ambitions.

Škoda recorded the strongest growth within the group, with unit sales increasing by 8.2%. SEAT&CUPRA continued its turnaround by improving its operating result, while Volkswagen Commercial Vehicles posted a significantly higher operating result despite a slight decline in unit sales.

The Volkswagen Passenger Cars brand faced a difficult market in North America, where sales incentives, product mix, and costs linked to ending ID.4 production in Chattanooga contributed to an operating result that was slightly below the first half of 2025.

Electric Urban Car Family Receives Strong Customer Response

The company said its Electric Urban Car Family has received a positive response since its recent introduction. More than 70,000 orders have been placed for the entry-level electric models from Volkswagen, Škoda, and CUPRA, although only three of the four planned models—the CUPRA Raval, ID. Polo, and Škoda Epiq—are currently available.

The Brand Group Core reported an operating margin of 4.9%. Excluding the previously mentioned special items, operating performance reached 5.9%.

New Cooperation Model Takes Effect

Beginning July 1, the Brand Group Core implemented a new cooperation agreement that reorganizes key functions across Volkswagen Passenger Cars, Škoda, SEAT&CUPRA, and Volkswagen Commercial Vehicles.

The Core Executive Committee now serves as the central leadership body at the Brand Group Core level. Volkswagen said the agreement establishes binding transparency, information-sharing, and coordination requirements while maintaining each brand’s responsibility for its own markets and brand identity.

The company said the updated structure is designed to address increasing competitive and financial pressures by improving coordination and decision-making across the organization.

Production Strategy Targets €1 Billion in Savings

Volkswagen said its “Future Production Governance” strategy shifts production management toward a regionally focused structure, placing responsibility closer to manufacturing plants and business operations.

Regional management teams have already been established and now oversee their respective production networks. The company also repositioned the Central Europe region and introduced comparable structures for the Iberian Peninsula and Central Europe.

According to Volkswagen, the revised production management model is expected to generate cumulative savings of 1 billion euros by 2030 in production alone.

Brand Performance Breakdown

Volkswagen Passenger Cars

Volkswagen Passenger Cars sold 1.530 million vehicles during the first half of 2026, excluding China and including external manufacturing, representing a 0.5% increase from the previous year.

Sales revenue declined to 42.30 billion euros from 43.45 billion euros in H1 2025 as difficult market conditions and competitive pressure continued. Operating profit fell to 995 million euros due to costs related to ending ID.4 production in the United States and additional restructuring expenses.

The operating margin reached 2.4%. Excluding restructuring costs and expenses tied to the discontinuation of ID.4 production in the U.S., the margin was 3.8%.

Škoda Auto

Škoda Auto delivered 555,700 vehicles worldwide during the first half of 2026, an increase of 9.1% compared with H1 2025. The company remained Europe’s second-best-selling brand.

Deliveries of the all-electric Elroq and Envaq nearly doubled, helping Škoda become the fourth-best-selling battery electric vehicle brand in Europe. More than 30,000 orders have been received for the newly launched Epiq and Peaq models.

Sales revenue rose 6.3% to 16.0 billion euros, while operating profit increased 6.3% to 1.37 billion euros. The operating margin remained stable at 8.5%.

SEAT&CUPRA

SEAT&CUPRA reported an operating result of 122 million euros, an increase of 84 million euros from the first half of 2025. Sales revenue rose 1.3% to 7.7 billion euros.

The company said its performance program, operational efficiency, and cost discipline supported the improvement. The absence of additional EU import tariffs on the CUPRA Tavascan also contributed positively.

CUPRA sold a record 170,100 vehicles during the first half of 2026. The launch of the CUPRA Raval, produced in Spain as part of the Electric Urban Car Family, helped increase electric vehicle orders by 85% during the second quarter.

Volkswagen Commercial Vehicles

Volkswagen Commercial Vehicles delivered about 192,200 vehicles during the first half of 2026, approximately 7% more than a year earlier. Growth was supported by the New Transporter and higher deliveries of the ID. Buzz People in Europe.

The brand maintained a 23.2% share of the battery electric vehicle segment, remaining the market leader. Unit sales totaled 216,000 vehicles, down 4% from the first half of 2025, while sales revenue declined to 8.2 billion euros from 8.7 billion euros.

Despite lower revenue, operating profit increased to 275 million euros from 207 million euros in H1 2025. The operating margin improved from 2.4% to 3.3%.

Volkswagen Brand Group Core said its first-half results reflected the impact of ongoing efficiency programs and closer collaboration across its volume brands while continuing efforts to strengthen competitiveness through organizational changes, cost reductions, and regional cooperation.