The pressure building on Volkswagen’s management has reached a critical juncture. The controlling Porsche and Piëch families, according to Reuters, have escalated their demands for swift restructuring, backing a plan that could eliminate tens of thousands of additional jobs. The anchor shareholder Porsche SE is pushing for accelerated implementation of cost-saving measures, even as its own half-year results reveal the financial toll of the crisis: a €2.2bn loss driven by a writedown on its VW stake.
The families’ intervention lands at a delicate moment in Lower Saxony, where state politicians are demanding clarity on which sites might face cutbacks. Reports on Thursday pointed to an escalating crisis, with potential plant reductions looming larger than previously communicated. For investors, the message is increasingly clear: the transformation will be faster and more painful than initially signaled.
China’s Slide Raises Existential Questions
While the restructuring standoff dominates headlines in Germany, the numbers from Volkswagen’s most critical market paint an equally troubling picture. Deliveries from VW and Audi in China fell to 971,150 vehicles in the first half of 2026 — a 26 percent decline year-on-year. More alarming still, new energy vehicles account for just 5 percent of that total, meaning 95 percent of cars sold in the world’s largest auto market are still combustion-engine models.
The company has launched a broad electric offensive with models including the Audi E7X, E5 Sportback, ID. Era 9X and ID. UNYX variants, but volumes remain modest. The ID. Era 9X has moved 10,000 units, the ID. UNYX models 7,409, and the Audi E7X managed 4,000 in June. By contrast, the combustion-powered Lavida alone sold 80,000 units, with the Tiguan L at 76,000. The joint ventures with SAIC and FAW together deliver over 590,000 vehicles, yet only a fraction are electric.
The question hanging over the stock is whether this ratio can shift quickly enough. Volkswagen retains significant market presence through its JV structures, but the depth of the decline — 26 percent is no mere blip — suggests structural share loss rather than a temporary dip. The NEV penetration rate of 5 percent indicates the company is struggling to keep pace with local rivals in a market rapidly pivoting to electric powertrains.
EU Green Light Provides Counterweight
Offsetting some of the gloom, the European Commission has approved the sale of a majority stake in Volkswagen’s marine engine business, Everllence, to Bain Capital. The transaction, which had been under regulatory review, now clears the way for fresh capital to flow into the group’s coffers. While details on the deal’s structure and volume remain undisclosed, the approval itself marks a tangible step in the company’s portfolio streamlining.
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The timing is notable: the EU clearance arrives as Volkswagen also revises its US strategy, with plans for a new pick-up model and management changes. Audi sales chief Marco Schubert is reportedly set to shift roles in the US, underscoring the personnel overhaul underway across the Atlantic.
Market Sends a Clear Verdict
The share price tells its own story. At €73.24, the stock sits just 5.8 percent above its 52-week low of €69.20 and roughly 33 percent below the year’s high of €109.10. The distance to the 200-day moving average of €91.58 — a 20 percent gap — reflects how thoroughly investors have repriced the company’s prospects. Since the start of the year, the shares have lost 30 percent.
Technical indicators offer little directional clarity: the RSI stands at 42.8, firmly in neutral territory, suggesting the market is waiting for concrete evidence before committing either way. The EU deal approval provides a positive signal for optimists, potentially freeing capital for reinvestment in the China strategy or the electric model push. For bears, however, the structural erosion in China remains the dominant narrative, with the new electric models yet to reach the critical mass needed to offset shrinking combustion sales.
A Defining Test Ahead
The coming months will serve as a referendum on Volkswagen’s ability to execute on multiple fronts simultaneously. The families’ insistence on rapid restructuring will collide with political resistance in Lower Saxony if the hinted tens of thousands of additional job cuts materialize. Meanwhile, the monthly Chinese delivery reports will reveal whether the electric offensive is gaining genuine traction or merely treading water.
The Everllence approval releases capital but does nothing to resolve the fundamental questions around plant capacity and employment in Germany. And the Porsche SE’s own balance sheet damage — a €2.2bn loss from the very stake it is pushing to revive — underscores how deeply the crisis has penetrated the ownership structure itself.
For now, Volkswagen remains caught between the families’ demand for speed, the political realities of Lower Saxony, and the competitive onslaught in China. The EU approval offers breathing room, but the harder questions — about scale of job cuts, pace of electrification, and the future shape of the group — remain unanswered.
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