Key Takeaways
- Volkswagen shares have been hard hit over the past five years amid increased competition and falling sales.
- A fresh restructuring deal, including slimming production and shuttering factories, could provide a much-needed boost.
- At EUR 82 a share, the stock remains well below its fair value estimate.
Volkswagen VOW3 is embarking on a drastic turnaround strategy.
Shares have been in decline for five years as increased Chinese competition, US tariffs, and weaker European demand have dented profits. The auto stock is trading down 22% so far in 2026, at less than a third of its 2021 levels.
But could a breakthrough restructuring deal mark a turning point for Europe’s largest carmaker?
What Does Volkswagen’s Turnaround Plan Mean for the Stock?
Volkswagen shares gained 6% last week, after the German auto titan’s supervisory board backed sweeping overhaul plans under CEO Oliver Blume.
The strategy calls for 50,000 more job cuts, fewer models and further plant closures as part of what the firm has described as “the most extensive transformation program” in its history.
A deal struck this week to sell the firm’s embattled Osnabrück plant to an Israeli defense company is part of that transition. Other struggling auto factories could now be seen following suit.
Morningstar equity analyst Rella Suskin calls the plan a “big step” forward in the 89-year-old firm’s “history of inflexibility.” But while the firm’s job cut plans beat market expectations, she calls the aim to reach 9% operating margin by 2030 “unrealistic.”
It comes after the firm cut its full-year sales outlook for 2026 on continued soft sales. Operating profit fell 12% in the first half of the year, after more than halving through 2025. So, are Volkswagen shares a buy now?
Are Volkswagen Shares a Buy in 2026?
With a market cap of EUR 41.6 billion, Volkswagen’s stock is currently trading near a two-year low of EUR 82 a share.
Still, Morningstar retained its fair value estimate for the stock of EUR 116 following last week’s restructuring deal, citing “significant upside” even if revenue growth remains flat.
The road ahead for Europe’s largest carmaker may be bumpy. But, for now at least, Volkswagen shares appear to have plenty of room to accelerate.
