Volkswagen keeps its 2026 cash flow outlook as margin guidance sits at up to 1%

The carmaker's Automotive Division still targets net cash flow of EUR 3 billion to EUR 6 billion for the year, a range it set on September 18.

Volkswagen is holding its 2026 cash flow outlook, even though its profit forecast for the year is far lower than it was in the summer. The Automotive Division still expects net cash flow of EUR 3 billion to EUR 6 billion and net liquidity of EUR 32 billion to EUR 34 billion.

The margin is where the pressure shows. On September 18, Volkswagen cut its 2026 operating return on sales forecast to up to 1%, from a range of 4.0% to 5.5%. The company said special effects of around EUR 10 billion will weigh on operating profit, including a non-cash impairment of around EUR 6 billion on goodwill allocated to Porsche. Without those items, it said, the full-year margin would be about 4%.

The cash flow base is firmer than the margin. In the first half, automotive net cash flow was EUR 3.2 billion, against a negative EUR 1.4 billion a year earlier. Volkswagen also changed its revenue guidance in September to around EUR 315 billion, from a range of 3% below to level with last year's EUR 321.9 billion.

Still, the costs behind that cash flow number keep growing. Deliveries are down 14.3%, a UK motor finance liability remains, and labour agreements have been terminated. A salary freeze runs through 2030. The target also depends on the IG Metall dispute not escalating, and that dispute is unresolved.

The rest of the sector gives little cover. Mercedes-Benz has cut its 2026 outlook, citing China and higher costs, and BMW and Stellantis shares are slipping alongside it. Automakers have little room left to absorb another shortfall without revising guidance again.