Major VW Restructuring: 100,000 Jobs to be Cut
On Thursday (03/09), German automotive giant Volkswagen (VW) announced that it will cut a total of 100,000 jobs by the end of the decade. This move is expected to be the largest restructuring in the history of the global automotive industry.
The company stated that management and trade unions have agreed on a plan to cut an additional 50,000 jobs, in addition to the 50,000 redundancies previously agreed upon.
“It is systemically important to adjust the workforce to current economic conditions,” stated the Volkswagen Group, which oversees several brands including Audi and Porsche.
The total of 100,000 jobs to be cut is equivalent to approximately 15% of Volkswagen’s global workforce. This figure exceeds the 50,000 layoffs undertaken by General Motors after the company declared bankruptcy in 2009.
Trade unions and management were involved in an open dispute before agreeing to the plan. Unions accused management of a lack of transparency with employees after news of the potential 100,000 layoffs appeared in the media before being communicated internally.
Furthermore, Volkswagen stated that the long-term future of four of its main plants in Germany—including Hannover, Emden, Zwickau, and Neckarsulm—cannot be guaranteed. If closed, these plants would be the first Volkswagen facilities in its home country to be shut down entirely.
“If these plants are truly closed, you could place a large black mark on the map,” said a long-serving employee at the Zwickau plant in Saxony, to news agency AFP. “This plant, including the surrounding jobs and our suppliers, is the driver for the entire region.”
Caught between US tariffs, competition from China, and the growth in electric vehicle demand, Europe’s largest car manufacturer is facing significant challenges.
However, Volkswagen CEO Oliver Blume emphasised that the decision to cut 100,000 jobs is a “strong signal for the future of the Volkswagen Group.”
Volkswagen has not detailed when the cuts will take place or how the workforce reduction will be distributed across the various regions where the company maintains factories and offices. However, the company stated it will shift its focus to North America and strive to increase exports to countries in the Global South.
The plan also includes investments worth hundreds of billions over the coming years. Volkswagen aims to enhance its technological capabilities through research and development while simultaneously increasing competitiveness.
One of the steps involves a corporate restructuring expected to accelerate decision-making and reduce the number of business units and company holdings by approximately one-third.