Volkswagen woes deepen as blue-chip index exit follows latest profit warning

Volkswagen shares dipped on Monday after another profit warning issued by the embattled German carmaker was followed by its departure from Europe's blue-chip index. Shares were 0.5% lower in mid-morning deals, extending Friday's 8.3% decline after Volkswagen downgraded its expected operating return on sales to 1%, from a previous forecast of 4% to 5.5%. It blamed an impairment related to its large holding in Porsche , a "further deterioration" in the market environment — particularly in China — and restructuring expenses. "An accelerated shift in demand in favor of battery-electric vehicles ... will lead to developments falling short of original expectations, especially for the Audi and Volkswagen Passenger Cars brands," the company added.