Volkswagen plans to reduce its workforce by up to 100,000 jobs as part of a significant cost-cutting strategy, which would eliminate nearly one in six positions from its global employee count of around 625,000. This restructuring aims to counter competition from Chinese automakers and follows earlier plans to cut 50,000 jobs by 2030. The proposed job cuts, potentially impacting four production plants in Germany, would lead to one of the largest job reductions in corporate history, surpassing prior layoffs by General Motors and IBM. The adjustments come amidst the company's ongoing effort to streamline operations and achieve annual savings of €6 billion by 2030. Unions have expressed strong opposition to these plans, emphasizing the need for management to seek more reasonable alternatives.

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Volkswagen to axe up to 100,000 jobs in sweeping cost-cutting drive

Restructuring would remove close to one in six workers and rank among biggest corporate lay-offs of all time

Several Volkswagen ID.7 electric cars lined up inside the Volkswagen electric fleet plant in Emden, Germany. Volkswagen is one of Germany’s biggest private industrial employers and its job-cut targets have often been softened following negotiations with its unions© Reuters

Sebastien Ash in Frankfurt and Kana Inagaki in London

PublishedJune 26 2026

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Volkswagen plans to cut up to 100,000 jobs and end production at four plants in Germany in a significant acceleration of its cost-cutting plans as Europe’s largest carmaker seeks to counter the rapid advance of Chinese rivals.

The cull would mean the removal of close to one in six of the company’s roughly 625,000 roles worldwide, making it one of the biggest ever job-cutting programmes.

If completed, the cuts, which are likely to be subject to tough negotiations with unions, would surpass the 74,000 jobs eliminated by General Motors in a 1990s restructuring and the 60,000 removed by IBM in 1993.

Wolfsburg-based Volkswagen had already laid out plans to cut 50,000 jobs in Germany by the end of 2030 and has said it wants to reduce its car-manufacturing capacity in the country by 500,000 units.

The latest plan, first reported by German outlet Manager Magazin, could lead the headcount to be slashed by another 50,000, according to one person familiar with the plan.

Previous job-cut targets at VW — one of Germany’s biggest private industrial employers — have often been softened following negotiations with worker representatives.

The restructuring measures come on the heels of the blockbuster sale of its marine engines unit Everllence to US private equity firm Bain, which will generate proceeds of €7.4bn.

Chief executive Oliver Blume has sought to streamline the sprawling group to focus on its core automotive business and is expected to sell more assets to raise cash as the carmaker comes under pressure.

VW reached a landmark agreement with unions at the end of 2024 to cut jobs and capacity in Germany, but the auto manufacturer has said the impact of US tariffs, the conflict in the Middle East and a worsening situation in China necessitates more action.

Under the previous plan, the carmaker closed a small production site in the east German city of Dresden. It has been seeking a buyer for its factory in Osnabrück, where production is set to run out next year, and has held talks with the maker of Israel’s Iron Dome missile defence system.

The new proposals would see production end at another four plants: VW sites in Emden, Zwickau and Hanover, as well as an Audi factory in Neckarsulm.

Blume has previously said that closing factories outright was not his preferred solution, and that he was seeking “intelligent” approaches, such as producing Volkswagen’s Chinese models at the plants or handing them over to other carmakers or defence companies.

European car manufacturers have been hit by the rise of Chinese carmakers, which accounted for almost one in 10 new vehicles sold in the region in the first five months of the year, according to European car industry body Acea.

“Never has the risk situation been so high,” Blume told shareholders at VW’s annual meeting last week

The company had targeted saving €6bn per year by 2030 through the restructurings and said costs remained “the area where we have the greatest need for action”.

VW declined to comment on the new plan, details of which are set to be presented to the company’s supervisory board on July 9.

“The underlying matters are discussed and approved by the relevant governing bodies. We will not pre-empt this process,” VW said.

The reported details of the plan, which include a reorganisation that could limit employees’ rights at the company, produced an angry response from workers’ representatives.

“Should such plans be pursued, we would oppose them with all our might,” said the head of VW’s works council Daniela Cavallo, the president of union IG Metall Christiane Benner and Lower Saxony union boss Thorsten Groeger in a statement.

“What really matters is something else entirely: instead of engaging in blind, knee-jerk reactions, the management board should finally do its job,” they said.

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