Key facts
- Volkswagen is proposing to cut up to 100,000 jobs and close German factories.
- The influential IG Metall union has organized protests at 18 sites across Germany.
- The proposals are being presented to Volkswagen's supervisory board for the first time.
- Potential plant closures include Hanover, Emden, Zwickau, and Audi's Neckarsulm site.
- The Volkswagen Act requires a two-thirds majority for plant closures covered by the law.
Volkswagen's proposal to reduce its workforce by up to 100,000 employees and close several German factories is set for a critical review by the company's supervisory board. The influential IG Metall union has organized protests at 18 sites across Germany, including the company's headquarters in Wolfsburg, to signal opposition to the plans. Union leaders have warned CEO Oliver Blume that he cannot shift the responsibility for recent failures onto the workforce.
The proposed cuts, which include the potential closure of four German plants—Hanover, Emden, Zwickau, and Audi's Neckarsulm site—are part of a radical transformation plan. Sources indicate that up to 50,000 additional job cuts could be tied to these closures. The automotive industry in Germany, which employs over 650,000 people directly and indirectly, views this board meeting as a significant test for its future. The company is also exploring structural changes, including the potential carve-out or spin-off of its core brand division and components technology business.
The German automotive trade body, VDA, has previously warned of a potential employment collapse in the sector unless bold decisions are made, such as selling unviable plants to foreign companies. Volkswagen, which employs over 650,000 people across its brands like Audi, Bentley, Skoda, Seat, and Cupra, has been impacted by increased competition from China and the challenges of transitioning from combustion engines to electric vehicles.
If the proposals are accepted by the supervisory board, which includes company representatives, union members, and local politicians, months of negotiations with unions would follow. Plant closures at sites covered by the specific 'Volkswagen Act' require a two-thirds majority, making approval difficult against union opposition. However, the Zwickau and Neckarsulm plants are not covered by this law, meaning their closure would not require supervisory board approval, though it would likely face significant resistance and potential strikes.