Key facts
- Volkswagen is reportedly planning a major restructuring involving up to 100,000 job cuts globally.
- Four German production sites, including Volkswagen's Hanover, Zwickau, and Emden plants, and Audi's Neckarsulm plant, are slated for potential closure.
- The core Volkswagen brand and its components division are to be carved out as independent companies.
- The company's net profit fell 28% in the first quarter of 2026, with revenue down 2%.
- Labor agreements currently protect jobs until at least 2030 for Volkswagen and 2033 for Audi.
Volkswagen is reportedly preparing for its most significant restructuring in history, with plans to cut up to 100,000 jobs worldwide and potentially close four German production sites. The move, spearheaded by CEO Oliver Blume, aims to address a deep-seated structural crisis within the automaker.
According to a report citing insiders, the job cuts would double previous targets, which had aimed to shed around 50,000 positions by 2030. The affected plants are said to be Volkswagen's sites in Hanover, Zwickau, and Emden, along with the Audi plant in Neckarsulm. Manufacturing at these locations would cease once current models are phased out.
The company is also planning a fundamental overhaul of its structure, with the core Volkswagen brand and its components division potentially being carved out into independent companies. This could facilitate easier access to capital markets for these entities in the future.
These drastic measures come in the wake of a significant profit slump in the first quarter of 2026, where net profit fell by 28% to 1.56 billion euros on revenue of 75.7 billion euros, a 2% decrease. CFO Arno Antlitz has warned that existing cost-cutting measures are insufficient and that the company risks its future if further action is not taken.
Adding to the pressure are US tariffs, which Antlitz stated cost the group around four billion euros annually, and a 20% drop in sales in China, Volkswagen's most crucial market, during the first quarter. This decline is attributed partly to the increasing competitiveness of Chinese manufacturers like BYD.
Enforcing such extensive job cuts presents legal challenges, as Volkswagen has a job guarantee until the end of 2030, and Audi until the end of 2033, under labor and collective bargaining laws.