Volkswagen planning to cut up to 100,000 jobs globally

Volkswagen is reportedly planning significant job cuts, potentially up to 100,000 positions globally. This move comes as the automotive group, which includes brands like Porsche and Audi, experiences a sharp decline in profits and faces intense competition, particularly from Chinese manufacturers. The company's operating profit has fallen considerably in recent years, and sales have dropped significantly in key markets like China and the US. Some of Volkswagen's electric car production plants are also considered expensive to operate. These plans follow a prior agreement with German trade union IG Metall to reduce 35,000 jobs at the Volkswagen brand by 2030, with an additional 15,000 cuts across other brands. The current discussions suggest a more extensive reduction in workforce.

Volkswagen CEO Oliver Blume confirmed plans to cut 50,000 jobs as part of a significant restructuring, despite the supervisory board rejecting a proposal to close four German factories. Blume stated the realignment is the company's most comprehensive, involving 12 initiatives and 45 resolutions to reduce overheads, which are currently 20% higher than comparable companies. He indicated that personnel costs constitute half of these overheads, leading to a theoretical job reduction of 50,000 if costs remain unchanged. The company aims to reduce car production from 12 million to 9 million units annually and is exploring alternative uses for factories, such as defense production. Staff union IG Metall criticized the downsizing plans, calling for new ideas to utilize plant capacity.