Volkswagen unveils four-year plan but lacks backing for overhaul with up to 100,000 job cuts
Volkswagen's proposed restructuring plan failed to win backing from the labour bloc on the company's supervisory board on Thursday, leaving uncertainty over additional job cuts and factory closures. The carmaker nevertheless laid out plans to reduce production capacity and simplify its model range.
Volkswagen's labour representatives on the supervisory board blocked a sweeping restructuring plan at a meeting on Thursday, Reuters reported on Friday, citing company sources.
This comes as Europe's largest carmaker wrestles with falling profits, rising costs and competition. Volkswagen said on Friday that its global vehicle deliveries fell 8.6% year on year in the second quarter, a steeper decline than in the previous quarter.
The company's share price was down by 0.6% around noon in Europe. The focus, however, remained on the restructuring proposals that divided the supervisory board.
As the board met at Volkswagen’s headquarters in Wolfsburg on Thursday, IG Metall, one of Germany’s largest trade unions, organised coordinated protests across the country to stop a plan that reportedly includes up to 100,000 job cuts worldwide — more than 15% of its workforce — and closing four plants in Germany: Volkswagen factories in Hanover, Emden and Zwickau, as well as Audi's Neckarsulm plant.
According to Reuters, citing unnamed company sources, these measures were rejected by the supervisory board on Thursday, which includes labour representatives and representatives of the state of Lower Saxony. The committee voted against management's proposed restructuring by 12 to seven, after opposition from labour representatives.
Volkswagen made no mention of possible job cuts or plant closures late on Thursday. Instead, after the meeting, Volkswagen unveiled its strategy through to 2030, including plans to halve the number of models it offers and reduce the number of vehicle variants by as much as 75% in an effort to cut costs and complexity, measures that did not require the approval of the supervisory board.
Volkswagen said it would reduce annual production capacity to around 9 million vehicles to respond to “sharply intensified competition”. That compares with capacity of around 12 million vehicles before the Covid-19 pandemic and about 10 million today.
Other measures include tailoring products and technology more closely to regional markets, aligning production capacity to match demand, and simplifying the group’s corporate structure and investment portfolio.
Volkswagen chief executive Oliver Blume said in a video statement that “the global situation has deteriorated over the past 12 months”, pointing to geopolitical tensions, tariffs, high costs, increasing regulation and intensifying global competition.
He also said Volkswagen needed to “get rid of excess capacity”, leaving open the possibility of factory closures in the longer term. Blume added that “digitalisation, artificial intelligence and shared services will help increase productivity and speed”.
Arno Antlitz, Volkswagen Group’s chief financial officer, said the cost reductions already agreed were “not sufficient in the current economic and geopolitical environment”.
He said the company planned to improve vehicle cost structures, “significantly reduce overhead costs”, increase plant efficiency and accelerate technology development and decision-making.
Volkswagen employs about 657,000 people worldwide, but the company has not said how the planned reduction in production capacity would affect its workforce. According to Reuters, Volkswagen's works council has demanded clarification on management's cost-cutting plans by the end of Friday.
The group has repeatedly argued that deeper restructuring is necessary after its net profit fell 28% to €1.56bn while revenue declined 2.5% year on year to €75.7bn in the quarter to March 2026.
“The next few years will decide who will play a decisive role in the automotive industry in the future,” Blume said.
Volkswagen workers furious as management withholds cost-cutting plans
11.07.2026
Volkswagen's workforce has suffered a major loss of confidence in the German automotive giant's leadership after top management failed to share details about rumoured cost-cutting plans, employee representatives said on Saturday.
Europe's largest carmaker is in uproar over reported cuts of around 100,000 jobs across Germany, with trade union IG Metall holding protests nationwide on Thursday. A supervisory board meeting on the same day ended without confirmation of chief executive Oliver Blume's plans.
Angered at being excluded, the VW works council issued a demand for the release by Friday of full information about what Blume called the "most comprehensive realignment" in Volkswagen's history.
"We strongly condemn the fact that, at the same time, he continues to withhold this information from the tens of thousands of affected employees outside management," the council said in a statement on Saturday.
The works council had demanded that Blume address the workforce by Friday.
"The workforce's main focus will be on whether the Executive Board intends to tackle this crisis by taking the necessary measures together with the employees, or against them," the statement continued.
The details of the cost-cutting package - which was reportedly rejected by the supervisory board - are as yet known only from media reports.
According to Manager Magazin, up to 100,000 jobs could be cut worldwide - twice as many as previously planned. The Bild tabloid reported that the figure could even be as high as 120,000.
Four of the VW Group's plants in Germany are also reportedly under threat of closure, in Hanover, Emden, Zwickau and Neckarsulm.
Volkswagen boss prefers 'smarter solutions' over factory closures
12.07.2026,
Photo: Johannes Neudecker/dpa
Volkswagen Group chief executive Oliver Blume said he believed the carmaker could avoid factory closures as it presses ahead with efforts to cut costs.
"There are smarter solutions than closing plants," Blume told the Bild am Sonntag newspaper in an interview published on Sunday.
A cost-cutting programme at Volkswagen's German production sites was already delivering results, he said.
"We were able to reduce our factory costs in Germany by an average of 20% last year alone. That's significant progress."
Blume's comments came after a meeting of the supervisory board on Thursday, where he reportedly failed to secure approval for a more far-reaching cost-cutting package.
According to a report in the Süddeutsche Zeitung newspaper, which cites sources within the group, representatives of the workforce and the German state of Lower Saxony voted against the package.
Details of the rejected package have so far emerged only through media reports.
According to Manager Magazin, up to 100,000 jobs could be cut worldwide - twice as many as previously planned.
Bild reported that the figure could even be as high as 120,000.
Four of the Group's plants in Germany are also under threat of closure including a factory operated by VW's Audi subsidiary.
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