Volkswagen Superviosory Board Approves Plan To Slash Models & Reduce Workforce By 100,000

Volkswagen Superviosory Board Approves Plan To Slash Models & Reduce Workforce By 100,000 Support CleanTechnica's work through a Substack subscription, on Patreon, or on Stripe. Help us produce all of the high-quality, original content we publish week after week despite the challenges of content-scraping AI, antisocial media, inflation, and other hurdles. In June, Germany’s Manager Magazin reported that Volkswagen Group CEO Oliver Blume had a plan to close four factories in Germany and eliminate 100,000 workers, both in Germany and around the world, by 2030. It said the plan would be made public at a company board meeting on July 9. The Volkswagen factories affected were said to be those in Hanover, Zwickau, and Emden, as well as the Audi factory in Neckarsulm. July 9 came and went, and the plan did not get the approval from the board of directors that Blume expected. The vote was 12 against and only 7 in favor of Blume’s vision. As we reported at the time, “What happens now is anyone’s guess. Volkswagen is producing more cars than it can sell, a situation that cannot go on indefinitely. It has seen its annual sales fall from around 12 million vehicles to just 9 million. That is still a lot of cars and trucks, but the profit margins on them have fallen as well, putting the squeeze on investors.” Then, on September 3, 2026, Volkswagen Group announced that the plan submitted in June had been approved unanimously by the supervisory board. Insiders have consistently described Blume as “determined” to push ahead with his restructuring plan. Following his initial setback, Handelsblatt reported that he wanted to implement the strategy “in stages now — if necessary, even against opposition from employees and the state of Lower Saxony” The company already has plans in place to reduce its workforce by 50,000. The new plan adds another 50,000 to that number, bringing the total to 100,000. But wait, there’s more! The plan calls for eliminating half of all the models currently offered and still leaves the fate of four factories in Germany up in the air. Focus On The Long Term In a statement, the company said, “As the automotive industry and its markets undergo their fastest and most fundamental shift to date, it enables the Volkswagen Group to pave the way for sustainable long term success. The Future Plan 2030 sets the stage to make the Volkswagen Group and its brands stronger, more competitive and better positioned for the future. The Executive Board will now jointly drive the necessary measures, collaborating with the brands, subsidiaries and employee representatives.” Blume told the press, “The Supervisory Board has unanimously approved the Executive Board’s Future Plan presented today. This is a strong signal for the future of the Volkswagen Group. We are taking responsibility for our entire workforce, for our partners and for industrial jobs worldwide. Over the coming years, we will invest a three figure billion sum to make our iconic brands even more attractive, stronger, and more competitive.” A concept for a sustainable and competitive production structure is to be developed for the European plants by the end of June 2027, the press release said. “With its resolution, the Supervisory Board acknowledges that Volkswagen Group’s European capacity currently exceeds demand by more than 500,000 units and that a competitive future production allocation for the Emden, Zwickau, Hanover and Neckarsulm plants cannot currently be secured on a staggered basis from 2031 to 2034. In parallel and in addition, alternative uses for these plants are being assessed.” More than 40,000 people work at those four factories, which have a combined annual production capacity of around 750,000 vehicles. Fortunately, actions by the current US administration aimed at undermining NATO are providing new opportunities to put underutilized factories to good use for the production of military hardware. Opportunities are where you find them. “People forget how big the car industry is,” Harald Hendrikse, a managing director at Citi Research, told the New York Times. “The chance of saving all of these jobs and all of this capacity with the defense industry is zero.” Another possibility is using some of that excess factory space to build cars for Chinese companies. Time To Step Up IG Metall and the Volkswagen Group works council, who strongly opposed the original plan proposed by Blume, are holding their fire, at least for now. They stressed that this most recent decision prevented an escalation of hostilities between management and workers. At the same time, they said the management board now had to do its homework. “The confrontational approach and communication by the management board in recent weeks were not constructive,” said IG Metall chief Christiane Benner and works council chair Daniela Cavallo in a joint statement. However, Benner and Cavallo said that the spinoff of the core brand was now off the table and that the attack on Germany’s co-determination structures had therefore been successfully fended off. They added that “no plant has been abandoned, and contrary to several media reports, no plant closure has been finalized. Instead, concrete solutions must now be developed for all sites, and we continue to see the management board as having a clear responsibility.” For years, we here at CleanTechnica have been predicting major changes ahead for legacy automakers. There are millions of people who may want an automobile but who are not in a position to pay $48,500 for one — the average price of a new car today in the US. There are huge potential markets in India, Africa, and the Orient, but many of those people are not looking for a 3-row, seven-passenger SUV. They are more likely to prefer entry-level cars that are simple, practical, and cheap. Chinese automakers are only too happy to offer customers cars that are significantly less expensive. A V8 Was Good Enough For My Father! Many manufacturers, especially in the US, are sticking to big, hulking models with tried and true infernal combustion engines. They seem not to know or care that electric cars are now about a quarter of new car sales, with the percentage rising quarter by quarter. Volkswagen is making a bold move by proposing to prune its model lineup by half. There is no word on whether the models Volkswagen will choose to cut from its lineup will be powered by conventional or battery electric powertrains. There is also no guarantee that the restructuring at Volkswagen will succeed. The latest tariffs by the US administration are making many of the models it sells in America uncompetitive. Its sales in China have gone over a cliff, and its sales of conventional cars in Europe have been trending down for the past several years. The only real bright spot for the company is that sales of its electric vehicles in Europe have been trending up. Despite all the happy talk about restructuring, there is still a chance that mighty Volkswagen — which was once tied with Toyota for the title of #1 car company in the world — could experience a Nokia moment and cease to exist as a major car company. The turmoil in the industry is fierce and there is no guarantee that Volkswagen can weather the storm headed its way. What happens in Wolfsburg in the next few years could be a harbinger of what is waiting down the road for Ford, GM, and Stellantis as well. Just because a car company has been successful in the past is no guarantee it will continue to be successful in the future. Sign up for CleanTechnica's Weekly Substack for Zach and Scott's in-depth analyses and high level summaries, sign up for our daily newsletter, and follow us on Google News! Have a tip for CleanTechnica? Want to advertise? Want to suggest a guest for our CleanTech Talk podcast? Contact us here. Sign up for our daily newsletter for 10–15 new cleantech stories a day. Or sign up for our weekly one on top stories of the week if daily is too frequent. CleanTechnica uses affiliate links. See our policy here. CleanTechnica's Comment Policy