Volkswagen is weighing one of the most dramatic restructurings in its nearly 90-year history, with plans that could eliminate up to 100,000 jobs worldwide and close four factories in Germany.
According to a Reuters report citing people familiar with the matter, members of Volkswagen's supervisory board have been informed of the proposals ahead of a key meeting scheduled for July 9.
If approved, the overhaul would represent the largest transformation in the company's history and one of the most significant workforce reductions ever undertaken by a global automaker.
The proposed measures include shutting production at Volkswagen's plants in Hanover, Zwickau, and Emden, as well as Audi's factory in Neckarsulm. Together, those facilities employ more than 45,000 workers, according to the sources cited by Reuters. The potential cuts would come in addition to approximately 50,000 job reductions already agreed upon with labor unions in late 2024.
Chief Executive Oliver Blume reportedly presented the restructuring strategy to senior executives earlier this week in an effort to secure management support before the proposals reach the supervisory board. Reuters reported that the plan was first revealed by Germany's Manager Magazin.
Beyond workforce reductions, the company is also considering reducing planned investments by roughly 15%, lowering spending to just over 130 billion euros, or about $148 billion, over the next five years. The report also said Volkswagen is exploring separating its core Volkswagen passenger car brand and components business into standalone entities as part of a broader corporate reorganization.
Volkswagen declined to confirm the reported plans. In a statement to Reuters, a company spokesperson said it would not comment on confidential internal documents but acknowledged that the automaker faces profound challenges."The entire group, including its brands and subsidiaries, must undergo far-reaching change," the spokesperson said, adding that all major decisions will be made through the company's established governance process.
The proposals are expected to face fierce opposition from Germany's influential labor representatives. Volkswagen's works council and the powerful IG Metall union issued a joint statement pledging to fight any attempt to implement the reported measures.
"Should such plans go ahead, we would do everything in our power to prevent them," the organizations said. The restructuring also faces political hurdles. The German state of Lower Saxony, Volkswagen's second-largest shareholder, holds special voting rights under the so-called Volkswagen Law, giving it significant influence over strategic decisions, including plant closures.
Labor representatives also occupy half the seats on the supervisory board, making approval of sweeping restructuring measures particularly difficult. Volkswagen has been squeezed by rising U.S. tariffs, slowing demand in Europe, the costly transition to electric vehicles, and increasingly aggressive competition from Chinese manufacturers.
China has become one of Volkswagen's biggest concerns. According to consulting firm AlixPartners, the market share of non-Chinese automakers in China fell to 32% in 2025 from 57% in 2020. Volkswagen, long the country's best-selling foreign automaker, slipped behind BYD in 2024 and fell to third place in 2025 as domestic electric vehicle makers expanded rapidly.
Chinese manufacturers are also making significant gains across Europe. Automakers including BYD, Chery, SAIC, and Leapmotor doubled their combined European market share through May compared with a year earlier, according to data from the European Automobile Manufacturers' Association.
