Volkswagen announced plans to cut up to 100,000 jobs globally over the next several years, representing about 15% of its 657,000-strong workforce. The company also intends to close four German plants located in Hanover, Zwickau, Emden, and Audi's plant in Neckarsulm as part of the restructuring effort [1, 2, 3, 4].

CEO Oliver Blume submitted a detailed 2030 vision report to Volkswagen’s supervisory board on June 24 outlining these measures. The production at the four German plants will be phased out gradually as the models currently produced are discontinued [5, 6]. Blume said, "The entire Group—including its brands and subsidiaries—must undergo profound change" [3].

Volkswagen plans to reduce its investment over the next five years by around 15% to just over 130 billion euros, approximately $148 billion [1, 7, 8, 3]. The restructuring will include spinning off the core VW brand and parts manufacturing plants into separate entities [1, 4].

The company faces fierce competition from Chinese electric vehicle makers, tariffs, and high costs during the shift from combustion engines to electric vehicles, which has severely impacted profitability. Volkswagen reported a 44% profit drop in 2025 with operating margins more than halved [9, 5].

Volkswagen had previously agreed with unions in 2024 to avoid plant closures and compulsory layoffs in Germany until 2030. However, the new plan breaks this agreement leading to strong opposition from labor groups including IG Metall. The union said, "If such plans were to be pushed forward, we would prevent them with all our might" [2, 3, 5].

Economic experts note the structural transition to electric vehicles is causing job losses and will affect regional economies. Berenberg Bank economist Holger Schmieding said, "The auto industry is currently in crisis and this crisis will continue," while Hamburg Commercial Bank’s Cyrus de la Rubia added, "This move by Volkswagen should make even the most stubborn politicians and managers realize that fossil fuel vehicles are no longer profitable" [5]. ING Bank economist Carsten Brzeski commented, "100,000 people will not be unemployed at once; the layoffs take many forms" [5].

Media outlets first reported the plans publicly on June 26 based on confidential documents [1, 10, 2]. The Volkswagen supervisory board is scheduled to meet July 9 to discuss and possibly approve the restructuring and layoffs [2, 4, 5]. The outcome will determine the company's next steps in navigating the industry transition and cost pressures.