Volkswagen, Europe's largest carmaker, has announced plans to cut its global model lineup by up to 50% and reduce available equipment options by as much as 75%, as the company's supervisory board met at its headquarters in Wolfsburg, Germany, to consider a broad restructuring package. The company confirmed it aims to reduce annual production capacity from around 12 million to 9 million vehicles, refocusing investment on what it described as the "most attractive" market segments and the products delivering the greatest value for customers and the group alike.
The announcement follows years of mounting pressure on the German automotive giant, whose profit margin has roughly halved between 2021 and 2025. High operating costs, excess production capacity, intensifying competition from Chinese manufacturers, stricter emissions regulations, and US import tariffs have all eroded Volkswagen's financial position. CEO Oliver Blume, who earlier this year flagged a revised strategic vision for 2030, acknowledged that the group's longstanding business model — developing and manufacturing in Europe while selling globally — no longer functions as it once did. The cuts are to be implemented gradually across the group's brands, which include Audi, Škoda, SEAT, and Porsche.
What remains unconfirmed, though widely reported in German media, is the scale of potential job losses and plant closures. Documents leaked ahead of the supervisory board meeting suggested Volkswagen could shutter four factories in Germany — in Hannover, Emden, Zwickau, and Neckarsulm (home to an Audi plant) — with closures phased between 2031 and 2034, and up to 100,000 jobs eliminated worldwide, double an earlier target of 50,000. The company made no official statement on redundancies or closures following the meeting, which ended without binding decisions.
The uncertainty has sparked protests across more than a dozen Volkswagen sites in Germany. Around 500 workers rallied outside the Wolfsburg headquarters as the supervisory board convened, while approximately 1,500 gathered in Emden, and smaller demonstrations took place in Ingolstadt, Zwickau, Stuttgart, and elsewhere. The powerful IG Metall trade union, which represents workers across Germany's industrial sector, vowed fierce resistance to what it called the management's "brutal plans." Union leader Christiane Benner accused executives of stoking fear among employees who had already made concessions in previous rounds of cost-cutting. Works council chair Daniela Cavallo called on CEO Blume to address staff directly and dispel the uncertainty.
The restructuring proposals face significant political obstacles within the supervisory board itself. The state of Lower Saxony — in which Wolfsburg is located — holds a 20% stake in Volkswagen and has seats on the board, and its deputy premier has already spoken out against plant closures. Combined with ten worker representatives on the board, this bloc currently holds a majority, making it unlikely that the management's proposals will pass unaltered. For Volkswagen's roughly 300,000 employees in Germany and hundreds of thousands more worldwide, the coming months of negotiation will determine how deep the cuts ultimately go.