Key facts
- Volkswagen plans to halve its number of vehicle models and reduce variants by up to 75%.
- The company aims to reduce annual production capacity to approximately nine million vehicles.
- Reports suggest potential job cuts of up to 100,000 employees and closure of four German plants.
- German trade union IG Metall has protested the potential restructuring.
- Volkswagen's net profit fell 28% to €1.56bn in the quarter to March 2026.
Volkswagen Group is undertaking a significant overhaul through 2030, aiming to reduce global production capacity by 1 million vehicles and its vehicle lineup by up to 50% to enhance competitiveness. The strategy includes halving models and cutting variants by as much as 75% to lower costs and complexity, as the automaker faces mounting pressure from geopolitical tensions, tighter regulations, and intensifying competition from Chinese carmakers.
CEO Oliver Blume stated that a worsening global situation, including geopolitical tensions and high costs, necessitates the reduction of "excess capacity." Chief Financial Officer Arno Antlitz added that existing cost reductions were insufficient, and the company plans to significantly reduce overhead costs and improve plant efficiency.
The announcement follows discussions where extensive restructuring plans were reportedly considered. Reports suggest Volkswagen is considering eliminating 100,000 jobs globally, representing over 15% of its 657,000-strong workforce, and closing four German plants: Volkswagen facilities in Hanover, Emden, and Zwickau, along with Audi's Neckarsulm plant. These potential measures would exceed the 35,000 job cuts already agreed upon in Germany by 2030.
However, the official plan released by Volkswagen did not directly confirm these figures, stating instead a reduction in annual production capacity to around nine million vehicles from approximately 10 million currently. German trade union IG Metall has organized protests across the country, warning of a potential major conflict with management if job cuts and plant closures proceed as rumored.
Volkswagen reported a 28% drop in net profit to €1.56 billion and a 2% decline in revenue to €75.7 billion for the quarter ending March 2026.