UPDATE 1-Volkswagen forecasts margin recovery after tough 2025

Adds context, CEO quote, revenue forecast

WOLFSBURG, March 10 (Reuters) - Volkswagen VOWG_p.DE expects its dwindling profit margin to recover this year after a bruising 2025 hit by tariffs, tough competition from China and a costly shift towards electric.

The German auto group said it expects an operating margin of between 4.0 and 5.5% in 2026, after it stood at 2.8% in 2025.

Last year's margin came in slightly below an expected 2.9%, according to analysts polled by Visible Alpha, and slumped from 5.9% a year earlier.

Like its rivals, Volkswagen has been battling challenges across key markets, with U.S. tariffs costing the company billions and local competition eating into its market share in China.

"We are operating in a fundamentally different environment," CEO Oliver Blume said in a statement.

The company expects sales revenue in 2026 to develop in a range of zero to 3%.


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