In late October 2024, Volkswagen’s works council announced that the group’s management was considering closing three factories in Germany, which would lead to the loss of tens of thousands of jobs, as well as a general reduction in salaries. On October 30, the group announced a 63.7% fall in third-quarter net profit. With more than 200 billion euros in debt, Volkswagen has become the most indebted listed company in the world. Its sales are down and its costs (notably for energy, personnel and research and development) have soared.
How did Europe’s leading carmaker, the largest industrial employer in Germany and a symbol of its style of capitalism and harmonious co-management between shareholders and unions, get to this point? As a result of a series of strategic errors, baroque governance and toxic management practices.
