In a memo sent to staff on Monday, Volkswagen CEO Oliver Blume disclosed that the group faces a 20% cost disadvantage against comparable carmakers and that closing that gap through headcount alone would mean eliminating a further 50,000 roles worldwide.
The additional cuts would come on top of 50,000 jobs the 10-brand automaker is already in the process of cutting in Germany under a 2024 deal with unions. The memo described a "theoretical deduction" of another 50,000 jobs worldwide, while Blume said the company is "currently assessing across all brands, companies and regions how many adjustments are actually necessary and feasible."
Europe's largest carmaker has come under intense pressure from US tariffs, slimmer profit margins from electric cars, and above all intense competition in China, the world's largest auto market. Overall vehicle deliveries fell almost nine percent in the April-June period from a year earlier, thanks to plunging demand in China.
The memo encompassed the entire Volkswagen Group, which spans Porsche, Audi, SEAT, Skoda, Lamborghini, and Bentley alongside the core brand. Four German factories were named directly: Emden, Hanover, Zwickau, and Audi's plant in Neckarsulm. In the memo, Blume said he wanted to stress that "intelligent solutions" were better than closing plants, but added the future of the four sites could not be guaranteed.
Labour representatives and the German state of Lower Saxony, both of whom take a dim view of plant closures, together hold more than half the seats on the supervisory board. The powerful IG Metall union organised protests at Volkswagen sites last week after reports emerged of the group's plans to ramp up job cuts, as well as potentially close four German factories.
Unions had strongly criticised Volkswagen and Blume for unsettling employees by allowing media reports of mass job cuts to circulate without comment, demanding that the CEO take a public stand. For working professionals in manufacturing, HR, and supply chains, the scale of the proposed restructuring signals a significant shift in how a major global employer is recalibrating its workforce in the face of trade pressures and market headwinds.
