Key facts
- Volkswagen is considering cutting up to 100,000 jobs worldwide, approximately 16% of its global workforce.
- The company is also considering closing four German plants: Hanover, Emden, Zwickau, and Audi's Neckarsulm site.
- Unions, including IG Metall, are organizing protests and vowing to resist the proposed restructuring.
- The carmaker faces pressure from US tariffs, weaker profit margins on electric vehicles, and intense competition in China.
- These plans are being presented to Volkswagen's supervisory board, which includes labor representatives.
Volkswagen's leadership is reportedly considering a significant restructuring that could involve cutting up to 100,000 jobs worldwide and closing four German manufacturing sites, including one Audi factory. This potential move, which represents about 16% of the company's global workforce, has ignited strong opposition from labor unions.
IG Metall, a powerful German union, along with the VW works council, has vowed to resist these plans, warning of a "major conflict" if the company proceeds. Workers have staged protests outside plants across Germany to voice their opposition.
The carmaker is facing mounting pressure from various fronts, including U.S. tariffs, declining profit margins on electric vehicles, and fierce competition in the crucial Chinese market. These challenges are driving the consideration of drastic cost-cutting measures.
While Volkswagen has existing agreements to avoid plant closures in Germany until at least 2030 and has already planned for 50,000 job reductions by 2030, the new proposals reportedly exceed these prior commitments. The supervisory board is set to discuss these sweeping restructuring plans, which could also involve simplifying the group's corporate structure by carving out or spinning off its core Volkswagen brand and components business.
Potential options being reviewed include shifting production of China-focused models to underused German sites, gradually ending production at certain plants rather than outright closure, or repurposing factories for defense manufacturing. The supervisory board's composition, with an equal split between shareholder and employee representatives, and the significant stake held by the state of Lower Saxony, could complicate the approval process.