Volkswagen China chief Ralf Brandstaetter expects the Chinese passenger car market to contract by 20%. This decline is forecast to occur in 2026. Brandstaetter compared the projected downturn to the economic impact of the COVID-19 pandemic.
The German automaker currently faces declining deliveries and shrinking profit margins in its most significant market. Volkswagen recently lowered its full-year operating margin guidance due to these challenges.
The anticipated market decline intensifies pressure on the company to execute its performance restructuring program. Volkswagen aims to address intensifying competition from rising Asian rivals.