Volkswagen is considering cutting up to 100,000 jobs by 2030 as Europe’s biggest carmaker accelerates a sweeping overhaul of its global operations.
The German automotive giant would roughly eliminate one in six of its worldwide employees, making it one of the largest restructurings in automotive history if approved.
Chief executive Oliver Blume is battling slowing electric vehicle demand, US tariffs and intensifying competition from lower-cost Chinese manufacturers eating into the group’s market share.
According to Manager Magazin, the plans include ending production at Volkswagen plants in Hanover, Emden and Zwickau, alongside Audi’s Neckarsulm factory once current vehicle programmes conclude.
Volkswagen declined to comment on what it described as confidential internal documents but acknowledged the profound scale of pressures facing the business.
“It is correct that the entire automotive industry and the Volkswagen Group are undergoing a profound transformation,” a spokesperson said.
“The executive board has repeatedly stated that our current business model no longer works across all brands: developing cars in Germany, producing them in Europe and exporting them to the world.”
The company said tariffs, intensifying competition and stagnating markets were creating financial pressures amounting to “tens of billions of euros” a year, forcing sharper focus on costs and investment.
The reported overhaul comes days after Volkswagen agreed to sell a majority stake in heavy-engine business Everllence to Bain Capital for 7.4 billion euros, the latest step in Blume’s efforts to simplify an expensive corporate structure.
Chinese manufacturers including BYD, Geely, SAIC and Chery have rapidly expanded across Europe with competitively priced electric vehicles, eroding the dominance long enjoyed by German brands.
Volkswagen itself lost its position as China’s biggest carmaker to BYD in 2024 before briefly reclaiming the top spot earlier this year as government subsidies for electric vehicles faded.
Recent data from the European Automobile Manufacturers’ Association showed Chinese brands doubled their European market share in May compared with a year earlier, underscoring the competitive pressure reshaping the continent’s automotive sector.
Earlier this year Volkswagen explored using spare production capacity at its Osnabrück plant for defence manufacturing, holding talks with Israel’s Rafael Advanced Defense Systems over producing defence-related components.
Matthias Schmidt, founder of Schmidt Automotive Research, said: “The VW Group has suffered from years of neglect in readjusting workforce numbers due to the stranglehold the regional government and trade unions have on the company.”
“The market reality is hitting the German giant hardest,” Schmidt added, capturing the severity of the competitive challenge now confronting Volkswagen’s leadership.
The plans are expected to form part of Blume’s so-called ‘Concept 2030’ strategy, due to be presented to Volkswagen’s supervisory board next month.
Any factory closure proposals will likely face fierce resistance from Germany’s powerful IG Metall union, Volkswagen’s works council and Lower Saxony, the company’s second-largest shareholder.
Volkswagen shares have lost more than 30 per cent this year and are trading close to 16-year lows as investor concern mounts over the carmaker’s ability to compete in an industry increasingly defined by Chinese rivals.