VW chief
confirms plan to cut 50,000 jobs as board rejects plant closures
Oliver
Blume tells staff restructuring proposal includes ‘controversial decisions’ but
he has broad support
Lisa
O’Carroll
Mon 13
Jul 2026 14.42 BST
The chief
executive of Volkswagen has confirmed plans to cut 50,000 more jobs despite the
carmaker’s supervisory board rejecting his plan to shut four factories in
Germany.
Oliver
Blume told staff on Monday that proposals for a sprawling restructuring was
“the most comprehensive realignment in the company’s history” and revolved
around “12 initiatives, approximately 150 pages and 45 individual resolutions”
for change.
In his
most detailed explanation of the management blueprint for the future, Blume
told staff that “despite some decidedly controversial decisions” on the table,
he had perceived “broad support on the supervisory board” of his analysis of
the group’s future and the need for action.
Last
Thursday, the board spent hours hearing Blume’s proposals, previously leaked,
with staff protests at all sites for Volkswagen, Audi and Porsche brands across
Germany.
Asked
about staff concerns about jobs, Blume – who has positioned himself as a
Volkswagen insider – said he was “doing everything in his power” to keep the
company competitive enough to survive. He promised to enter into “constructive
discussions” with staff.
Blume
joined Audi at 28, working as a planner in its body shop and paint operations,
before rising through the ranks to head Porsche and then taking on the
leadership of the entire group in 2022.
“I can
fully understand how deeply the current situation affects people within the
company, as well as everyone in its immediate circle. I have spent my entire
professional life with the group,” he said.
He said
the 2024 programme to reduce the workforce by 50,000 jobs was already taking
place in a “socially responsible manner” involving voluntary redundancy
packages and partial retirement arrangements. The company has already cut
37,000 jobs from the workforce through these schemes, but a second phase of
cuts aimed at reducing overheads was now necessary, he added.
Blume
said in the memo that a further 50,000 jobs may now be cut if the carmaker’s
costs were not reduced.
He said
company benchmarking put its overheads at 20% above comparable companies.
“Since
half of our overhead costs result from personnel costs, a theoretical
calculation – assuming no change in labour costs – would result in the
elimination of approximately 50,000 positions worldwide,” he said.
He
confirmed there was still a question mark over four factories, three Volkswagen
plants - in Emden, Hanover and Zwickau – and the Audi plant in Neckarsulm,
where production is scheduled to end between 2031 and 2034.
Blume
told staff that “smart solutions are always better than closing a plant” but
that “Germany cannot turn a blind eye” after the car market was flooded with
cars that are not needed, both from China and Europe.
The group
intends to reduce production of cars from a pre-pandemic level of 12m cars a
year to 9m, he said, as the wider automotive industry in Germany warned of
potential job collapse if overproduction was not addressed.
In the
past two years, Volkswagen has already reduced production by 2m, with another
500,000 units to be cut from production in China, where the carmaker is facing
huge pressure from local competition too.
Blume
said the company “must continue on this path” of reducing overheads by 20% at
its factories, including cutting half of its model lineup, especially the
variants of different brands.
The
company is also exploring alternative options for factories to secure jobs. He
said it was still in advanced discussions about the transformation of its
factory in Osnabrück from automotive to defence production.
Over the
weekend, it was reported that a Volkswagen plan to make vehicles supporting the
Israeli defence company Rafael – designed to protect jobs at Osnabrück – had
been blocked by Qatar’s sovereign wealth fund, which has a 10% stake in VW.
IG
Metall, the main staff union, had no comment on Blume’s comments but hit out
against plans last Thursday.
Christiane
Benner, the chair of IG Metall, said the proposals were unacceptable
particularly as the union had already made concessions.
“Instead
of taking this achievement as a model, the board is confronting employees with
new downsizing plans. Understandably, the resulting anger and uncertainty are
immense. We need new ideas and concepts for utilising plant capacity, sensible
considerations from the company,” she said.
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