Volkswagen Reports Decline in Global Sales but Regains Lead in Chinese Market

Volkswagen Group has experienced a decline in global vehicle deliveries in the first quarter of the year. The German automotive manufacturer delivered a total of 2.05 million vehicles across all its brands worldwide, marking a 4 percent decrease compared to the same period last year. Despite this overall reduction, the company maintained a relatively stable share in an increasingly contracting global automotive market.

The global downturn in sales has been most pronounced in China and North America, two key markets for Volkswagen. In China, a market characterized by growing competition and a shrinking customer base, Volkswagen delivered 548,700 vehicles, representing a nearly 15 percent drop year-on-year. The North American market also saw a significant decline, with deliveries falling by over 13 percent to 205,500 vehicles. In the United States specifically, sales decreased by 20.5 percent, influenced by new import tariffs and adverse regulatory changes.

Despite these setbacks, Volkswagen managed to reclaim the top position in the Chinese automotive market during the first quarter. This resurgence was primarily attributed to recent changes in electric vehicle subsidies in China, which disadvantaged many domestic electric vehicle brands. Volkswagen, with its established internal combustion engine lineup, was able to leverage this shift and temporarily increase its market share. However, the company does not expect this lead to be maintained throughout the year, as local competitors are anticipated to regain momentum.

Last year, Volkswagen ranked third in new car registrations in China, behind electric vehicle manufacturer BYD and Geely, the parent company of Volvo. After decades as the market leader in China, the company has been working to defend its position amidst intensifying competition and rapid market changes.

In contrast to its challenges in China and North America, Volkswagen reported growth in several other regions. In Western Europe, deliveries increased by 4.2 percent to almost 850,000 vehicles. Eastern Europe also saw a 7.6 percent rise, reaching 135,000 units. The German market contributed positively with a 4.8 percent increase, while South America experienced a 7 percent growth, totaling 148,000 vehicles. However, these gains were insufficient to offset declines in other major markets.

Sales of electric vehicles (EVs) have also faced challenges. Volkswagen's global EV deliveries fell by 7.7 percent to 200,000 units, a sharper decline than that seen in its combustion engine models. In China, EV sales dropped almost 64 percent, largely due to changes in government incentives. The United States witnessed an 80 percent reduction, following the elimination of federal EV support. In response, Volkswagen announced the discontinuation of ID.4 electric vehicle production in the U.S., shifting its focus to manufacturing more combustion-engine SUVs, such as the Atlas model.

Conversely, the European market provided a bright spot for Volkswagen's EV segment. Electric vehicle deliveries in Europe increased by 11.5 percent to 176,400 units. Orders for all powertrain types grew by 3 percent across the continent, with pure electric models seeing a 4 percent rise. Demand for plug-in hybrid vehicles was also strong, with a 31 percent global increase in deliveries compared to the previous year.

Volkswagen's overall sales have been on a downward trajectory for the past two years. In 2025, the company's vehicle deliveries dropped below the nine million mark for the first time in years, totaling 8.98 million units. This widened the gap with Toyota, which maintained its lead as the world's largest automaker with 11.3 million vehicles sold, having overtaken Volkswagen in 2020.