▲ Volkswagen
Europe's largest automaker, Volkswagen, has suffered the humiliation of being removed from the Euro Stoxx 50 stock index, which comprises 50 blue-chip European stocks.
According to Euronews, STOXX, the index operator, excluded Volkswagen and Dutch information services company Wolters Kluwer from the Euro Stoxx 50 starting from the trading session on September 21 (local time), while adding Finnish telecom company Nokia and French energy firm Engie to the index.
Volkswagen's expulsion is attributed to its shrinking market capitalization caused by a plummeting share price.
Despite a sweeping restructuring plan finalized recently, Volkswagen's stock has dropped by around 30 percent this year alone.
From its peak in 2021, it has plummeted to roughly a quarter of its value.
Removal from a major index means that passive funds tracking the index will pull out, which could add downward pressure on the stock price.
Volkswagen shares fell more than 1 percent during trading on this day, even as the Frankfurt stock exchange in Germany rebounded.
Earlier this month, Volkswagen's management received approval from the supervisory board for the largest restructuring plan in its history, which increases the number of planned job cuts from the previous 50,000 to 100,000.
However, on September 18, citing additional restructuring costs, the company drastically lowered its operating profit margin outlook for this year from the previous 4.0–5.5 percent to a maximum of 1 percent.
Its operating profit margin last year was 2.8 percent.
Volkswagen aims to raise its operating profit margin to the 9 percent level by 2030.
Porsche SE, the holding company of the Volkswagen Group, was also pushed out of the DAX index, which consists of Germany's top 40 blue-chip stocks, last year.
(Photo: Getty Images)
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