Earthquake in Volkswagen: laying off about 100 thousand workers and closing factories

According to the report, CEO Oliver Blum and CFO Arno Antalitz are formulating a strategic plan for 2030, designed to make the group more efficient and profitable in light of the dramatic changes the automotive industry is undergoing.

At the center of the plan is a cut of up to 100,000 employees – about 15% of the group’s workforce, along with the splitting of the Volkswagen brand and the parts production division into separate entities. It was also reported that the company is considering closing four production plants in Germany, including plants in Hanover, Zwickau and Emden, as well as an Audi plant in Kressulm, after the models produced there today are gradually phased out.

In addition, Volkswagen plans to reduce the scope of its investments in the next five years by about 15%, so that they will amount to slightly more than 130 billion euros.

The move comes at a challenging time for European automakers, which are facing increasing competition from Chinese manufacturers and profitability pressures. In recent years, Volkswagen has announced several efficiency plans, but the current plan, if implemented, will be the most extensive yet.

According to the report, the plan is expected to arouse opposition from the workers’ councils in Germany, among other things because it deviates from the agreements signed with the company last year, under which Volkswagen pledged not to close factories in the country during the next decade.