Volkswagen plans another 50,000 job cuts in sweeping overhaul

German car giant will halve its model range, review the future of four European plants and slash its investment portfolio as it battles weaker demand and intensifying global competition

Volkswagen is planning to cut around 50,000 more jobs worldwide as part of the most far-reaching transformation programme in its history.

The German car giant’s supervisory board has unanimously approved its ‘Future Plan 2030’, clearing the way for a sweeping restructuring aimed at cutting costs, simplifying the business and restoring profitability.

The additional workforce reduction, which will include management roles, comes on top of existing programmes and is being blamed on intensifying global competition, changing demand and technological upheaval across the automotive industry.

Volkswagen will also halve the number of models it sells by 2035 and cut the complexity of its overall offering by around 75 per cent, concentrating production on fewer vehicles and variants in an attempt to lower costs and increase economies of scale.

The future of several European factories is also under scrutiny. Volkswagen says its production capacity in Europe currently exceeds demand by more than 500,000 vehicles and that future production allocations cannot presently be secured for plants in Emden, Zwickau, Hanover and Neckarsulm between 2031 and 2034. Alternative uses for the sites are now being considered.

Its portfolio of businesses and shareholdings will meanwhile be cut by around a third, with non-strategic operations either sold or reorganised and the group’s real-estate holdings also placed under review.

The restructuring will be accompanied by heavy investment in new vehicles, technology and future growth areas, with chief executive Oliver Blume promising a “three-figure billion sum” over the coming years.

Blume said: “The Supervisory Board has unanimously approved the Executive Board’s Future Plan presented today. This is a strong signal for the future of the Volkswagen Group.”

He added: “We are taking responsibility for our entire workforce, for our partners and for industrial jobs worldwide. Over the coming years, we will invest a three-figure billion sum to make our iconic brands even more attractive, stronger and more competitive.”

Volkswagen is targeting annual sales of nine million vehicles and an operating margin of nine per cent by 2030, equivalent to an operating result of about €31bn.

It is also planning €135bn of capital expenditure and research and development spending between 2027 and 2031.

Daniela Cavallo, chairwoman of Volkswagen’s Group and Central Works Council, said: “The Future Plan is a necessity to lead our Group successfully into the next decade – without placing the burden of that transformation solely on employees.”

She added: “In doing so, Volkswagen once again affirms that job security and economic viability carry equal weight as shared corporate goals. They are not in opposition; they are intertwined.”

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_{Main image: Volkswagen chief executive Oliver Blume, whose Future Plan 2030 includes plans to cut around 50,000 positions, halve the group’s model range and overhaul its European operations. Credit: Volkswagen Group}