Volkswagen could cut up to 100,000 jobs worldwide and close several factories in Germany as part of a sweeping overhaul designed to revive the struggling carmaker, according to reports.
It comes after German business magazine Manager Magazin claimed Volkswagen chief executive Oliver Blume is preparing one of the biggest restructurings in the company’s history.
The move follows falling profits, fierce competition from Chinese manufacturers and the expensive transition to electric vehicles, all of which have prompted a strategy rethink.
If the reported plans go ahead, the cuts would affect around 15 per cent of Volkswagen’s global workforce.
The magazine explained how Volkswagen also plans to reduce investment by around 15 per cent, cutting planned spending to just over €130billion (£111billion) over the next five years.
Mr Blume and Volkswagen chief financial officer Arno Antlitz are also reportedly planning to completely reshape the company by separating Volkswagen’s core passenger car brand and its parts manufacturing business into standalone companies.
According to the report, production would eventually stop at Volkswagen’s factories in Hanover, Zwickau and Emden, as well as Audi’s factory in Neckarsulm.
The closures would only happen once the current vehicle models built at those sites reach the end of their production life.
Volkswagen has not confirmed the reports and did not immediately respond to Reuters‘ request for comment.
Volkswagen was the best-selling brand in the UK last year, despite global woes
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VOLKSWAGENHowever, the company told Manager Magazin: “The relevant facts of the matter will be discussed and approved by the relevant bodies. We will not pre-empt this process.
“The Group Executive Board has repeatedly emphasised that our current business model no longer works for all brands in its present form.”
Volkswagen also said both the company and the wider automotive industry are undergoing “a far-reaching transformation.”
The latest claims come just months after Volkswagen announced plans to cut 50,000 jobs by 2030 as part of a separate cost-saving programme.
Volkswagen is currently looking at improving its strategy following profit losses
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VOLKSWAGENPublishing its annual financial results in March, the German manufacturer said it faced a “challenging environment” despite keeping sales revenue broadly stable.
The company blamed weaker profits on several factors, including US tariffs, slowing demand for electric vehicles and increasing pressure from Chinese rivals.
At the time, Mr Blume defended the company’s strategy. “We have demonstrated that our substance is robust and that our future-oriented programs are working.”
But he also acknowledged the scale of the challenge facing the business. “At the same time, we are operating in a fundamentally different environment. We are therefore determined to continue to pursue the course we have set.”
Volkswagen employs around 667,000 people worldwide, with almost 43 per cent of its workforce based in Germany.
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A reduction of 100,000 jobs would go well beyond the existing restructuring programme and would represent one of the largest workforce reductions in the company’s history.
The reported plans could also spark a major confrontation with trade unions. In 2024, Volkswagen reached an agreement with workers’ representatives that ruled out factory closures in Germany before the end of the decade.
Following the latest reports, Volkswagen‘s works council and Germany’s powerful IG Metall union issued a strongly worded response.
In a joint statement, they said: “Should such plans go ahead, we would do everything in our power to prevent them.”
Earlier this year, Volkswagen revealed that operating profit had fallen by more than 14 per cent, while revenue also declined compared with the previous year.
If confirmed, the proposals would mark one of the most significant reorganisations in Volkswagen’s history and could have major consequences for Germany’s automotive industry, where the manufacturer remains one of the country’s largest private employers.