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Volkswagen tops Tesla in Europe 2025 EV sales as ID-series models drive strong growth across markets.
The German automaker's cash flow and liquidity last year exceeded guidance and it received a boost after Trump walked back from plans to put tariffs on European goods.
The board will oversee decision-making across the group's core brands that could unlock around $1.2 billion in production savings alone.
The core brand group of German carmaker Volkswagen plans to cut back management positions and consolidate the platform in a bid to save 1 billion euros ($1.2 billion), the Automobilwoche industry publication reported on Wednesday.
Volkswagen faces significant near-term risks from potential new US tariffs, prompting a reduction in my price target to €160/share. Tariffs have already caused a meaningful €1.5B impact, and further escalation could cut EPS growth estimates by 10-20%. Despite volatility, VOW3 remains fundamentally strong, conservatively leveraged, and offers over 20% annual upside at current valuations.
Volkswagen is rated BUY, with 25-35% upside potential, driven by cost-cutting, new model launches, and significant undervaluation versus fair value. Despite 2025 headwinds—US tariffs, China market share loss, and Porsche weakness—VWAGY's sales and revenues grew, signaling resilient consumer demand. Management targets EUR 1.5 billion in cost savings by 2026, new BEV/ICV launches in Europe and China, and EBIT margin expansion from 3% (2025) to 5.4% (2030).
VWAGY slips to third in China as Geely overtakes it, underscoring pressure from fast-rising domestic EV brands in the world's largest auto market.
Deliveries of Volkswagen-branded vehicles in 2025 fell 1.4% on year as the market environment in China remained challenging while U.S. tariffs hit demand in North America.
VWAGY teams up with Qualcomm to power SDVs, enabling Level 4 driving, zonal architecture and AI infotainment by 2027.
Volkswagen was overtaken by Geely Auto in sales in China last year, dropping to third place after losing its decade-long dominance in the world's largest auto market to BYD in 2024, industry data showed.
The German automaker's sales in the United States plunged last year, hit by tariffs and the end of tax credits for electric vehicles.