Key facts
- Volkswagen CEO Oliver Blume is advocating for significant cost reductions and potential factory closures as part of a company-wide restructuring.
- Blume highlighted that Volkswagen's labor and factory costs are considerably higher than those at comparable European locations.
- Labor leaders, represented by works council head Daniela Cavallo, are opposing job cuts and plant closures, calling for a more comprehensive strategy.
- The company is considering measures that could double planned job cuts and potentially lead to factory closures.
- A crucial supervisory board meeting is scheduled for September 4 to discuss the restructuring plans.
Volkswagen CEO Oliver Blume is advocating for extensive cost reductions and potential factory closures as part of the company's largest-ever restructuring program. Blume has emphasized that labor and factory costs at Volkswagen are significantly higher than at comparable European locations, warning that more measures are needed to remain competitive against rivals, particularly from China. He visited vulnerable electric vehicle plants in Emden and Zwickau, urging employees to "pull together" for the company's future, a message met with protests and boos from some workers. Blume indicated that approximately half of the estimated 50,000 job cuts could occur in Germany, with the remainder spread internationally, though he stressed these are theoretical calculations and that factory closures are a last resort. Alternative proposals include shifting manufacturing towards the defense industry or producing electric vehicles for the Chinese market in German factories. The powerful supervisory board, which includes labor representatives and the state of Lower Saxony, holds a majority and will discuss the plans on September 4. Labor leaders, led by works council head Daniela Cavallo, are strongly opposing layoffs and plant closures, arguing that such measures alone will not address the challenges posed by tariffs, Chinese competition, and weak European demand. Cavallo expressed damaged trust in the executive board and CEO Blume, citing a lack of clear communication regarding the restructuring plans. Several key plants, including Osnabrueck, Emden, Zwickau, Neckarsulm, and Hanover, currently lack confirmed business plans beyond 2030.