Volkswagen weighs more job cuts as cost gap with rivals widens

Volkswagen could cut another 50,000 jobs as it works to close a growing cost gap with competitors, according to an internal memo from Chief Executive Oliver Blume seen by Reuters.

The latest proposal comes after the company had already agreed to reduce about 50,000 positions across the group, including at Porsche and Audi. If the latest reductions move forward, total planned job losses could reach around 100,000 worldwide.

Volkswagen cost gap drives restructuring

Blume told employees that Volkswagen operates with a 20% cost disadvantage compared with similar automakers.

The memo described another 50,000 job reductions as a “theoretical deduction” needed to match competitors’ cost levels.

“We are currently assessing across all brands, companies and regions how many adjustments are actually necessary and feasible,” Blume said in the memo.

Volkswagen has been under pressure as profits decline due to billions of euros in tariff costs, stronger competition in China and the need to improve efficiency across its German manufacturing network.

Factory Future and Supply Chain Restructuring

The restructuring plan has met resistance from labour representatives, who rejected proposals presented to Volkswagen’s supervisory board last week, according to sources familiar with the matter.

The proposals reportedly include additional job reductions and the possible closure of four factories.

Blume said the company has yet to identify competitive long-term uses for plants in Emden, Hanover, Zwickau and Neckarsulm during the 2030s.

Instead of shutting facilities, he said Volkswagen prefers “intelligent solutions,” including supporting the defence industry or producing Chinese Volkswagen models in Europe.

The company had previously declined to comment on reports that it was considering up to 100,000 job cuts.

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