The German automotive industry is facing an unprecedented crisis. Volkswagen AG, Europe's largest automotive conglomerate, is preparing a massive restructuring that could radically change the industry landscape. According to the "Group Target Picture 2030" strategy, developed by CEO Oliver Blume and CFO Arno Antlitz, the company plans to cut up to 100,000 jobs worldwide and close four key production sites in Germany.
Scale of Optimization and Plant Closures
The presented plan effectively doubles previously announced reduction volumes. The release of 100,000 employees accounts for about 15% of the group's total workforce. In the 2025 financial year, the global workforce of the conglomerate numbered more than 667,000 people, with nearly half (43%) working at enterprises within Germany.
According to internal documents, a complete cessation of production cycles is being considered at four strategically important sites after the release of current model generations:
- Zwickau — specializes in the production of ID.3 and Cupra Born electric vehicles.
- Emden — assembly site for ID.4 and ID.7 models.
- Hanover — key enterprise of the commercial vehicle division.
- Neckarsulm — plant of the subsidiary brand Audi.
Conserving these capacities puts more than 45,000 jobs directly in Germany at risk.
Financial Consequences and Strategic Shifts
The anti-crisis package provides not only for staff reduction but also for a 15% reduction in the investment program — to a level of slightly more than €130 billion for the coming five years. As part of the reorganization, an institutional split is planned: the main Volkswagen brand and the automotive components division are intended to be separated into independent legal entities for a potential stock market listing.
To optimize liquidity, a deal has already been agreed upon to sell the marine engine division Everllence to the American investment fund Bain Capital for €7.4 billion. Against the backdrop of the announcement of restructuring plans, Volkswagen shares on the Frankfurt Stock Exchange fell to 16-year lows.
Reasons and Market Context
Company management points to a systemic change in market conditions as the main reason for such radical steps. Key pressure factors include:
- US regulatory tariffs.
- Stagnation of demand for electric vehicles in the EU region.
- Long-term reduction of market shares in China under the influence of local manufacturers, such as BYD.
Legal Barriers and Union Resistance
The implementation of the proposed measures is associated with significant legal risks. Existing collective bargaining agreements guarantee job security for VW personnel until the end of 2030, and for Audi divisions — until 2033.
A joint statement by the management of the conglomerate's works council and the industry union IG Metall records the intention to offer tough legal and institutional resistance to any initiatives to close plants. A blocking voting package in the Supervisory Board is also held by representatives of the federal state of Lower Saxony (the second largest shareholder), whose leadership has already declared disagreement with the presented project.
According to German corporate governance legislation, decisions on plant closures require the approval of the Supervisory Board, where representatives of trade unions and state authorities traditionally possess parity influence. This translates the conflict into the realm of protracted collective bargaining negotiations, the outcome of which remains uncertain.