BY COMFORT OGBONNA
Volkswagen may need to eliminate around 50,000 additional jobs as it works to compete in an increasingly challenging global automotive market, Chief Executive Officer Oliver Blume told employees in an internal memo.
The announcement effectively confirms for the first time that Europe’s largest automaker is considering a workforce reduction of up to 100,000 positions worldwide as part of a major cost-cutting effort aimed at improving efficiency and restoring competitiveness.
Volkswagen is facing mounting pressure from several directions, including weaker profits, rising tariff expenses, intense competition from Chinese electric vehicle manufacturers, and the need to reduce costs across its German production network. The company has been working to restructure its operations as it attempts to adapt to rapid changes in the global car industry.
The automaker has already agreed to cut approximately 50,000 jobs across its various brands, including luxury subsidiaries Porsche and Audi. However, Blume said the company still needs to make further reductions after identifying a significant cost disadvantage compared with similar competitors.
According to the internal memo, Volkswagen estimates it currently carries a cost disadvantage of around 20% compared with comparable companies. The document stated that this gap could theoretically require another reduction of about 50,000 positions globally.
“We are currently assessing across all brands, companies, and regions how many adjustments are actually necessary and feasible,” Blume wrote in the memo.
Volkswagen had previously refused to comment on reports that it was considering cutting as many as 100,000 jobs. The latest message comes after growing frustration among employees and labor representatives, who have demanded more details about the company’s restructuring plans.
Blume presented the proposed strategy to Volkswagen’s supervisory board, where employee representatives reportedly opposed parts of the plan. People familiar with the discussions said the proposals included potential job reductions and the possibility of closing four manufacturing facilities.
The plants reportedly under review include facilities in Emden, Hanover, Zwickau, and Neckarsulm. Blume said the company could not currently confirm whether these factories would have competitive production plans in place for the 2030s.
“As of today, we still cannot confirm competitive use cases for the plants of Emden, Hanover, Zwickau, and Neckarsulm in the 2030s,” Blume said in the memo.
Despite the challenges, Volkswagen’s leadership has indicated that factory closures are not the preferred option. Instead, Blume said the company is seeking “intelligent solutions” to make better use of existing facilities.
Among the possible alternatives, Volkswagen has previously considered converting unused production capacity toward new industries, including defense-related manufacturing or producing Chinese-developed Volkswagen models in Europe.
The company did not mention potential job cuts or factory closures in its official statement following discussions with key stakeholders. However, the internal memo highlights the scale of the challenges facing Volkswagen as it attempts to reduce expenses and strengthen its position in a rapidly changing automotive industry.
The global auto market has become increasingly competitive, especially as Chinese electric vehicle manufacturers expand internationally with lower-cost models and traditional automakers face heavy investment demands linked to electrification and new technologies.
For Volkswagen, the restructuring effort represents one of the most significant transformations in its history. The company must balance the need to lower costs with pressure from employees, unions, and European governments to protect jobs and maintain industrial capacity.
As discussions continue, Volkswagen is expected to further evaluate its brands, factories, and regional operations before deciding the final scale of workforce reductions. The outcome could have major implications for thousands of workers and for the future of European automotive manufacturing.
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