China slump drives Volkswagen to sharpest quarterly fall in more than four years

German carmaker’s worldwide deliveries dropped sharply in the third quarter as a severe contraction in China outweighed growth elsewhere

Volkswagen Group has recorded its sharpest quarterly decline in global vehicle deliveries in more than four years as demand in China slumps.

Global vehicle deliveries have fallen 14.3 per cent in the third quarter to 1.89 million vehicles, according to new figures released by the German carmaker.

A contraction of the Chinese market has driven much of the decline, with quarterly deliveries falling 38.5 per cent to 405,800 vehicles as Volkswagen faces weaker demand and stronger competition from domestic manufacturers.

Deliveries also fell 5.8 per cent in North America and 2.8 per cent in Western Europe, although Central and Eastern Europe recorded growth of 1.4 per cent.

Volkswagen has delivered 6.01 million vehicles worldwide during the first nine months of 2026, down 9 per cent from 6.60 million during the same period last year.

China has accounted for most of the year-to-date decline, with deliveries there down 30.2 per cent to 1.38 million vehicles.

Among the brands owned by the Volkswagen Group, Volkswagen Passenger Cars recorded a 19.3 per cent fall in third-quarter deliveries, while Audi was down 19.7 per cent and Porsche fell 15 per cent.

Škoda deliveries were broadly unchanged, rising 0.2 per cent, while Lamborghini increased deliveries by 4.1 per cent.

The wider regional picture has been more resilient outside China.

Volkswagen’s deliveries in Western Europe rose 1.1 per cent during the first nine months of the year, while Central and Eastern Europe increased 5.3 per cent.

South American deliveries rose 4.3 per cent to 502,500 vehicles, while North American deliveries fell 4 per cent to 680,200.

Discussing the pressures in the company’s third-quarter delivery statement, Martin Sander, a member of Volkswagen Group’s Extended Executive Committee for Sales, said: “The sharp decline in the overall market in China remains an industry-wide challenge.”

The deterioration in China comes as other German manufacturers face similar pressure.

Porsche and Mercedes-Benz have also reported weaker Chinese deliveries, while Volkswagen’s global quarterly decline was its steepest since a 22.4 per cent fall in the second quarter of 2022.

Competition is also increasingly moving into Volkswagen’s home market, with around 20 Chinese brands attending this year’s Paris Motor Show, twice the number present in 2024.

Volkswagen is due to publish its interim financial report for the first nine months of 2026 on October 29.

Electric vehicles have produced a different picture across the group’s major markets.

Volkswagen’s global deliveries of battery-electric vehicles fell 4.7 per cent during the third quarter to 240,200 vehicles, but European deliveries rose 19.6 per cent to 209,100.

Battery-electric deliveries in China fell 30.1 per cent during the quarter, while deliveries in the United States dropped 86.4 per cent.

However, broader electrified deliveries – which include plug-in hybrid and range-extender vehicles – rose by around 30 per cent in China, with Volkswagen saying they are currently in strong demand.

Sander added that Volkswagen’s new locally developed electric models were also beginning to gain traction in China.

“Our new, locally developed electric models are beginning to make an impact,” he said.

The group’s electric-vehicle order book in Europe has doubled since the end of 2025, while orders rose by more than 60 per cent in the third quarter compared with the same period last year.

Around one in five Volkswagen Group vehicles delivered in Europe during the first nine months of the year was fully electric, while battery-electric models accounted for around 40 per cent of its order book.

Volkswagen said its new Electric Urban Car Family had attracted nearly 150,000 orders, with the company pointing to high fuel prices and a broader range of cheaper electric models as factors behind the stronger European demand.

Škoda has been one of the strongest performers within Volkswagen’s electric line-up.

Its Elroq was the group’s best-selling battery-electric model during the first nine months of the year with 92,200 deliveries, followed by the Volkswagen ID.4 and ID.5 with a combined 81,900.

The Škoda Enyaq recorded 72,700 deliveries, while Volkswagen delivered 61,100 ID.3 models and Audi recorded 50,400 Q6 e-tron models.

Across all markets, deliveries of plug-in hybrid and range-extender vehicles have risen around 23 per cent during the first nine months.

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_{Main Image: Volkswagen Group’s China headquarters in Beijing. Photo: N509FZ / Wikimedia Commons, CC BY-SA 4.0.}