Volkswagen is planning to cut up to 100,000 jobs globally, according to CEO Oliver Blume, which is double the 50,000 job cuts previously announced for Germany. This massive restructuring comes as the carmaker's costs are 20% higher than its rivals. Blume stated that if labor costs remain unchanged, a theoretical calculation would result in the loss of approximately 50,000 jobs, in addition to the 50,000 already being cut in Germany under a 2024 agreement with unions.
Volkswagen's profitability has seen a sharp decline, with operating profit falling from $25.8 billion (€22.6 billion) in 2023 to $10.1 billion (€8.9 billion) last year. This downturn is attributed to several factors, including a 26% drop in sales in China during the first six months of the year, a 7% decrease in US sales partly due to tariffs, and high restructuring costs associated with the shift to electric vehicles. The company's net profit after tax fell 44% in 2025 to $8 billion (€6.9 billion), its worst result since the diesel emissions scandal.
Blume emphasized the need to reduce costs "rigorously" and make the company "more efficient, more robust, and simpler." The job cuts will affect the entire Volkswagen Group, including brands like Audi and Porsche, and are primarily targeting Germany initially. This restructuring would be the largest in the global auto industry's history, surpassing General Motors' 50,000 cuts after its 2009 bankruptcy. There is also uncertainty regarding the future of four German plants: Emden, Hanover, Zwickau, and Neckarsulm, as they may not be competitive into the 2030s. The company's finance chief, Arno Antlitz, warned that the current profit margin, projected to be between 4% and 5.5% for 2026, is "not sufficient in the long run."
