By Amir Orusov
Jan 22 (Reuters) - Shares in Volkswagen jumped to the top of Germany's blue-chip DAX index on Thursday after Europe's biggest carmaker reported better-than-expected 2025 net cash flow in its automotive division.
Its shares were 4.6% higher by 1058 GMT, putting them on track for their biggest one‑day gain in six months.
Net cash flow for the year came in at around 6 billion euros ($7 billion), Volkswagen said late on Wednesday, 1 billion euros higher than the previous fiscal year and beating
the company's expectations for net cash flow of around zero.
While management had already hinted at potential upside to the guidance, the magnitude is surprising, analysts at Jefferies said in a note.
Industry sentiment was further buoyed by U.S. President Donald Trump backing away from his threats of tariffs against European allies opposed to his designs on Greenland, which eased immediate market worries over punitive trade measures, Warburg Research analyst Fabio Hoelscher said.
In a regular call with investors that also took place on Wednesday, Volkswagen, however, said it expects the pricing environment to be tense and profits from its Chinese joint venture to fall in 2026 before recovering in 2027, Bernstein analysts wrote.
The pan-European automobiles and parts index was up around 2.3%, with German carmakers BMW, Mercedes and Porsche rising between 1.9% and 2.6%.
"The federal electric vehicle subsidies in Germany and a technical rebound on the sector's relatively low valuations could be helping too," Hoelscher added.
Volkswagen is scheduled to release full-year 2025 results and its outlook for 2026 on March 10.
($1 = 0.8551 euros)
(Reporting by Amir OrusovEditing by Linda Pasquini and Miranda Murray)
