VW board approves plan to cut 100,000 jobs, halve model lineup

Volkswagen's supervisory board on Thursday unanimously approved the most sweeping restructuring in the automaker's history, a plan that will eliminate approximately 100,000 jobs, halt auto production at four German factories, and kill roughly half its global model lineup by 2035.

The Future Plan 2030, championed by CEO Oliver Blume, calls for 50,000 additional job cuts on top of 50,000 reductions already announced at Volkswagen, Audi, Porsche, and software unit Cariad — amounting to roughly 15% of Volkswagen's 650,000-strong global workforce. The company will also reduce vehicle variants and equipment options by about 75% and divest or realign roughly a third of its non-core business holdings.roadandtrack+3

Four Plants Face the End of Auto Production

Plants in Emden, Zwickau, Hanover, and Audi's Neckarsulm factory will be phased out of vehicle production on a staggered basis between 2031 and 2034. Volkswagen said it cannot secure "competitive future production" for the sites and will explore alternative uses, though no formal closure announcements have been made.finance.yahoo+2

The affected facilities represent a large share of Volkswagen's electric vehicle manufacturing in Germany. Zwickau was the company's first major plant converted entirely to EV production, while Emden builds the ID.4 and ID.7, and Hanover produces the ID. Buzz. Volkswagen acknowledged that European production capacity exceeds demand by more than 500,000 units annually.roadandtrack+2

Chinese Competition and Falling Profits

The restructuring is a direct response to mounting pressure from lower-cost Chinese competitors and the impact of U.S. tariffs. Volkswagen reported a 30% drop in after-tax earnings in the first half of the year, driven largely by weakening sales in China.indexbox+1

Volkswagen plans to spend €135 billion on capital investment and research and development from 2027 through 2031, targeting annual sales of nine million vehicles and a 9% operating margin by 2030. In North America, the group will focus on its most profitable segments, while in China it is scaling back growth expectations and expanding exports toward the "Global South".roadandtrack+1

Labor Tensions Ease — For Now

Chief employee representative Daniela Cavallo, who had sharply criticized the plan when it was first presented over the summer, ultimately backed it. "The Future Plan is a necessity to lead our Group successfully into the next decade — without placing the burden of that transformation solely on employees," Cavallo said. Volkswagen shares rose following the announcement.wsj+2

Blume called the approval "a strong signal for the future of the Volkswagen Group," adding that the company would "invest a three-figure billion sum to make our iconic brands even more attractive, stronger and more competitive". Implementation begins immediately, though discussions with labor unions and subsidiaries are still required before portions of the plan take effect.volkswagen-group+1