Volkswagen risks a major conflict with staff over its cost-cutting drive, the union warns
CEO Oliver Bloom is considering cutting 100,000 jobs worldwide, about 16% of Volkswagen's workforce, and closing three of the company's plants in Germany and one Audi plant.
A union warned on Thursday that Volkswagen's management risks entering a "major conflict" with workers as the struggling German automotive giant tries to crystallize what may be the largest restructuring in the history of the global automotive industry.
"We will not stand idly by if the company does not change course," said Thorsten Gröger, an official of the IG Metall union, as workers staged protests over plans attributed to the carmaker to cut up to 100,000 jobs and close four plants.
Europe's largest carmaker is under pressure from US tariffs, weak profit margins in electric vehicle sales, and above all fierce competition in China, the world's largest car market.
The Volkswagen Group comprises ten brands ranging from Seat to Porsche, and is already cutting 50,000 jobs in Germany by 2030, including 35,000 jobs at the core Volkswagen brand. These cuts were agreed with unions at the end of 2024, alongside a pledge not to close any plants in Germany until at least the end of this decade.
But CEO Oliver Bloom is now considering cutting 100,000 jobs worldwide, about 16% of Volkswagen's global workforce, and closing three Volkswagen plants in Germany plus one Audi plant, according to Manager Magazin, which cited company sources.
"If these plans are implemented, we will stop them with all our might," said Christiane Benner, head of the powerful IG Metall union, in a joint statement with Volkswagen's works council chairwoman Daniela Cavallo.
IG Metall is organizing protests by Volkswagen workers at plants across Germany on Thursday, coinciding with company officials presenting the restructuring plans to the supervisory board.
What is on the table?
Thursday's meeting is unlikely to lead to an immediate decision, but it could mark the start of months of negotiations between management, unions, and politicians over plant closures and further waves of job cuts.
According to media reports, the board will discuss a comprehensive restructuring plan that could include closing four German plants — Hanover, Emden, Zwickau, and the Audi site in Neckarsulm — and cutting up to an additional 50,000 jobs.
The management is also reviewing Volkswagen's corporate structure and may spin off the core Volkswagen brand and the components unit, or list them as separate companies to streamline the group.
Instead of directly closing plants, Volkswagen could shift production of models intended for the Chinese market to underutilized German sites like Zwickau, an idea Bloom had previously floated.
Another option is to stop allocating new models to some plants, gradually phasing out production rather than immediately closing sites. The company has also suggested that underutilized plants could eventually be repurposed by defense companies seeking to expand production.
Why will approval be difficult?
The supervisory board typically consists of 20 members evenly split between shareholder representatives and worker representatives. However, worker representatives currently hold a majority on the board, following the recent resignation of Susanne Weigand, the former head of defense company Rheinmetall.
Volkswagen's ownership structure further complicates any restructuring; the state of Lower Saxony, which hosts the company's headquarters in Wolfsburg and six of its plants, holds a significant stake that can block key decisions.
If the plans ultimately gain approval, they would reduce Volkswagen's global workforce of about 630,000 employees by nearly 15%. This would surpass previous job-cutting programs in the automotive industry, including General Motors' reduction of nearly 50,000 jobs during its 2009 bankruptcy.
Germany's broader automotive sector — including BMW, Mercedes-Benz, and their suppliers — is also beginning to cut jobs and restructure in response to declining demand and rising competition.
