Volkswagen, Europe's largest carmaker, is set to eliminate roughly one in seven of its jobs worldwide. On Thursday, the company announced that management and unions had agreed to an additional 50,000 job cuts by the end of the decade, on top of 50,000 already planned, bringing the total to 100,000. This represents about 15% of the group's global workforce and marks the largest restructuring ever undertaken in the automotive industry.
In a statement, the ten-brand group said it was essential to "systematically align workforce levels with economic realities." The plan, approved by the supervisory board, includes the reduction of around 50,000 jobs in addition to the previously agreed cuts. The company is grappling with a perfect storm: US tariffs, sluggish demand for electric vehicles, and, above all, fierce competition from Chinese manufacturers both at home and in the Chinese market.
German plants under threat
For the first time in its history, Volkswagen may close full-scale factories in Germany. The company confirmed that the future of four plants—in Hannover, Emden, Zwickau, and Neckarsulm—cannot be guaranteed into the 2030s. These sites employ tens of thousands of workers and are central to the country's industrial fabric. The potential closures have already sparked concerns among labour representatives and regional politicians, who fear the social and economic fallout.
The agreement between management and unions, which was unanimously approved by the supervisory board, represents a breakthrough in delicate negotiations. CEO Oliver Blume called it "a strong signal for the future of the Volkswagen Group." However, the scale of the cuts underscores the severity of the challenges facing the company, which also owns Audi, Porsche, Škoda, SEAT, Cupra, Bentley, Lamborghini, and Ducati.
The 100,000 job losses eclipse previous industry records. General Motors cut 74,000 jobs and closed 21 plants in 1991 as it lost ground to Japanese rivals, and a further 47,000 jobs in 2009 during its financial crisis restructuring. Ford eliminated 35,000 jobs and closed five plants in 2002, and later cut tens of thousands more under its "Way Forward" plan. Volkswagen's restructuring now stands as the largest on record.
The news comes amid broader concerns about the resilience of Germany's industrial base. The country has been dealing with suspected sabotage at critical infrastructure and rising energy costs, which have weighed on manufacturers. Meanwhile, the political landscape is shifting, with far-right parties gaining ground in eastern Germany, partly fueled by economic anxieties.
Volkswagen's troubles are not isolated. The entire European automotive sector is under pressure to transition to electric mobility while facing global competition. The company's decision to cut jobs is a stark reminder of the difficult choices ahead. As the continent navigates this transformation, the fate of Volkswagen's German plants will be closely watched, not only by its workers but by policymakers across the EU.
The company has not specified which plants will close or when, but the announcement has already triggered reactions from unions, who have vowed to fight for every job. The negotiations are expected to continue, with the next round of talks scheduled for later this year. For now, the message from Wolfsburg is clear: the era of the internal combustion engine is ending, and the transition will be painful.
