Volkswagen To Slash 100,000 Jobs By 2030 Amid China, EV And Tariff Pressure

Volkswagen has agreed to cut around 100,000 jobs globally by the end of the decade in what would be the biggest restructuring in the automotive industry, according to an AFP report. The plan includes around 50,000 new job cuts in addition to 50,000 reductions already agreed.

The combined cuts would affect roughly 15% of Volkswagen’s global workforce and exceed the 50,000 job reductions made by General Motors after its 2009 bankruptcy. The move comes as Volkswagen faces pressure from US tariffs, uneven demand for electric vehicles and growing competition from Chinese carmakers.

The company said the restructuring was needed to bring staffing levels in line with its economic position. Chief Executive Oliver Blume said the supervisory board had unanimously approved the management’s future plan.

Four German Plants Face An Uncertain Future

Volkswagen and its unions also agreed that the long-term future of four German facilities in Hannover, Emden, Zwickau and Neckarsulm could not be guaranteed. The company said alternative uses for the plants were being considered.

However, workers’ representatives stressed that no factory closure has been approved. IG Metall union leaders and Volkswagen supervisory board members said they had reached a compromise with the state of Lower Saxony, a Volkswagen shareholder that hosts six of the company’s plants.

A potential closure of a Volkswagen factory would be a major development for Germany’s auto industry. The news agency quoted a worker at the Zwickau plant as saying the facility and the jobs linked to it were crucial to the surrounding region.

The planned restructuring follows months of tense negotiations between Volkswagen management and unions. Workers had criticised management after reports of large-scale job cuts emerged before the plans were formally communicated to employees.

Unions’ Influence On Plant Decisions May Be Reduced

Volkswagen also said it would review the decision-making structure of its supervisory board. The company said approval thresholds could be changed to bring them closer to standard corporate practices.

Under Germany’s 1960 law governing Volkswagen, a two-thirds majority of the supervisory board is required for decisions involving the establishment or relocation of plants. Since workers hold half the board seats, the rule has effectively given labour representatives significant influence over plant decisions.

The proposed changes could therefore reduce the unions’ ability to block major restructuring decisions.

Despite the tensions, IG Metall and Volkswagen’s supervisory board representatives said the agreement had prevented a further escalation of the dispute. They maintained that workers had not given up on any plant and reiterated that no closure had been approved.