Volkswagen expects additional burden of $5.8B from US tariffs

By Gokhan Ergocun

ISTANBUL (AA) - Germany-based automotive giant Volkswagen announced on Thursday that the US customs tariffs would impose an additional burden of €5 billion (approximately $5.8 billion) on the company this year.

Volkswagen reported a $1.3 billion loss for the third quarter and the January-September period.

The company's profit for the same period last year was €2.83 billion.

Volkswagen's profit for the January-September period fell by 58% compared to the same period last year, dropping to €5.4 billion.

The firm recorded €4.7 billion in expenses in the first nine months of the year due to changes in Porsche's electric vehicle strategy.

Arno Antlitz, the chief financial officer, said in a press release: “In the first nine months of the year, we have seen a mixed picture.

"On the one hand, there is the market success of our combustion engine and electric vehicles. On the other hand, the financial result is significantly weaker compared to the previous year."

He said this is partly due to the ramp-up of lower-margin electric vehicles.

"Additionally, we recorded charges of 7.5 billion EUR, primarily from increased tariffs, the adjustment of the product strategy at Porsche, and a goodwill impairment at Porsche," he added.

He also said increased trading tariffs and the resulting negative volume effects burden us by up to €5 billion on a full-year basis.