Volkswagen is considering cutting up to 100,000 jobs and shutting four German factories, according to Reuters. The plans would represent the biggest restructuring in the automaker's 89-year history.
Among the sites earmarked for shutdown are three Volkswagen plants — in Hanover, Zwickau, and Emden — as well as Audi's facility in Neckarsulm. Those four locations together employ more than 45,000 workers. A union deal struck in late 2024 had already set a target of eliminating around 50,000 positions; the new figures, if confirmed, would push the overall reduction to twice that amount.
Reuters reports that supervisory board members have been brought into the loop and a formal discussion is scheduled for July 9. Blume had already walked senior leadership through the proposal earlier in the week, seeking to build internal alignment before the broader fight with unions begins. Capital expenditure would also feel the impact: CNBC reported that the group's five-year investment budget would be trimmed by roughly 15%, bringing it to just above €130 billion ($148 billion). Structurally, the plan envisions separating both the flagship VW marque and the components business from the wider group to operate as standalone units, Euronews reported.
Volkswagen did not address the specifics of the reports, with a company spokesperson saying only that "the entire group, including its brands and subsidiaries, must undergo far-reaching change" and that the company would not comment on what it described as "confidential documents." Labor opposition was swift: IG Metall and Volkswagen's General Works Council released a joint statement warning that "should such plans go ahead, we would do everything in our power to prevent them."
The reported plans come on top of restructuring efforts already underway. At its June annual general meeting, Volkswagen disclosed that departure agreements covering more than 28,000 employees at Volkswagen, Audi, Porsche, and software unit CARIAD had already been signed, contributing toward a previously established objective of reducing German headcount by around 50,000 by 2030. CEO Oliver Blume said at the time that the cuts were driven by the need to align production capacity with current demand.
Volkswagen's financial pressure has mounted alongside the restructuring push. First-quarter 2026 earnings data underscored the pressure: net profit shrank by 28% year-on-year to €1.56 billion, and revenue edged down 2% to €75.7 billion. Antlitz has put the annual cost of U.S. tariffs at roughly €4 billion, while China — the group's single largest market — saw first-quarter sales tumble 20% as homegrown automakers, most notably BYD, continue to erode VW's position there, Euronews reported.
Shares hit their lowest level in 16 years on Friday, slipping 0.4%, a signal that markets are unconvinced the restructuring will deliver results, Reuters reported. Over the course of 2026, the shares have shed more than a quarter of their value.