Vehicle deliveries in China fell 7.1% in the first three months of 2025 compared to the same time in 2024, Europe’s biggest automaker said, even as they rose 1.4% overall worldwide.

For electric vehicles (EVs), the fall was even worse, with deliveries down 36.8% in China even as they rose almost 59% worldwide, driven above all by growth in Europe and the Americas.

China is the country where Volkswagen sells the largest number of its cars, with the 10-brand group making around 30% of all its sales.

A Volkswagen spokesman said that China deliveries were “in line with our expectations” given “the background of a highly competitive market.”

He insisted that the group was focused on “long-term strategic goals” rather than “maximising sales volumes”.

The carmaker has struggled in recent years in China to compete with local firms like BYD that make EVs catering to local tastes at more affordable prices, costing it market share.

It has also struggled elsewhere due to high labour costs at home, and weak demand for EVs in other markets.

The group, which apart from its namesake brand also makes models including Audi, Seat and Skoda, last year reached a deal with unions to cut 35,000 jobs in Germany by 2030.

Finance chief Arno Antlitz said at Volkswagen’s annual results in December that he expected Volkswagen “to fight back in and start gaining market share in China by 2026 at the latest”.

Volkswagen shares were down about 0.5% in Frankfurt, and have lost about 16% since March 25, the day before US President Donald Trump announced a 25% tariff on car imports.

The levies are set to deal a heavy blow to Volkswagen and other German carmakers as the US was last year the biggest importer of the country’s cars, according to the federal statistics agency Destatis.

“The world’s biggest economy accounted for 13.1% of the 3.4 million German cars sold abroad,” it said.