Volkswagen Group plans to cut approximately 100,000 jobs globally and close four factories in Germany as part of a massive restructuring effort [1].

This move represents one of the largest workforce reductions in the history of the automotive industry. By slashing costs and relocating production, the company seeks to remain competitive amid shifting global market demands and high operational expenses.

The proposed layoffs represent about 15% of the company's global staff [1]. In Germany, the closure of four plants will affect approximately 40,000 workers [1]. To offset these losses, the company intends to shift production to lower-cost plants in Eastern Europe, and sell some of its existing facilities to the defense sector [1].

CEO Oliver Blume is leading the initiative, which is currently being discussed by the company's supervisory board [1]. The plant closures are scheduled to occur sequentially through 2034 [1].

Financial targets drive the restructuring. Volkswagen aims to raise its operating-profit margin from 3.3% in the first quarter of 2026 to 9% by 2030 [1]. Additionally, the company plans to reduce its annual investment from about 310 trillion won to roughly 233 trillion won by 2031 [1].

For comparison, this scale of reduction exceeds the 74,000 employees fired by General Motors during its 1991 restructuring [1].

Despite the cuts, union leadership emphasizes the importance of the company's output. "The core of the Volkswagen Group, which has a strong brand, is to bring great products to the road in a competitive way," Daniela Cavallo, the Volkswagen Union Chair, said [1].

“Volkswagen plans to cut approximately 100,000 jobs globally.”

Volkswagen's strategy signals a pivot away from its traditional German manufacturing stronghold toward lower-cost regions to protect profit margins. The decision to sell facilities to the defense sector suggests a diversification of asset utility to recoup losses. If successful, the shift to Eastern Europe could permanently alter the industrial landscape of the German automotive sector, which has long been a cornerstone of the national economy.