Volkswagen chief executive Oliver Blume addressed thousands of workers at the company’s Wolfsburg headquarters, where he encountered vocal opposition to his proposed restructuring strategy. Workers held banners and chanted slogans expressing concern that employment decisions were being made primarily for financial reasons. Blume described the transformation initiative as the largest in company history and stressed that unified commitment from all employees was necessary for success.
The restructuring plan remains subject to approval from VW’s supervisory board, which includes worker representatives, as well as the state government of Lower Saxony and shareholders. Blume outlined the scope of potential reductions, indicating that approximately half of anticipated job cuts would occur in Germany, with the remainder distributed internationally across roughly 170 companies. He emphasized that these figures represented a theoretical calculation rather than a firm target, derived from analysis showing the company’s costs running roughly 30 percent above industry averages.
Blume indicated management’s preference for voluntary separation arrangements over compulsory dismissals, citing options such as early retirement programs, negotiated exits, and natural workforce attrition combined with hiring restrictions. Factory closures were characterized as the most expensive option and would only be pursued as a last resort. The company is exploring alternative uses for manufacturing facilities, including potential production for defense applications and manufacture of electric vehicles currently marketed only in China.
Certain manufacturing operations face imminent discontinuation, with the Osnabrück plant scheduled to cease car production potentially within the following year. Multiple other facilities, including locations in Emden, Zwickau, Neckarsulm, and Hanover, have no manufacturing plans scheduled beyond 2030. Daniela Cavallo, head of VW’s works council, expressed strong opposition to these closures and criticized the chief executive for insufficient transparency regarding specific plans, stating that management’s vagueness had damaged employee trust.
VW contends with significant market pressures including intensified competition from Chinese manufacturers, declining sales in the Chinese market, and elevated tariffs in the United States. The company has struggled with reduced profitability and excess production capacity in Europe over an extended period. Previous efficiency measures, including a 20 percent average cost reduction at German facilities, proved inadequate to address structural challenges.
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