Volkswagen is planning drastic job cuts: 35,000 jobs at risk!

Volkswagen is planning drastic job cuts: 35,000 jobs at risk!

There is a lot of trouble in the automotive industry in northern Germany. Volkswagen (VW) is facing massive job cuts. The group plans to cut a total of 35,000 jobs by 2030. Around 20,000 of these departures have already been contractually agreed. All you can say is: there's a lot of change going on here! These cuts affect more than a quarter of the 130,000 jobs that VW offers in Germany. news38.de reported that there are no plans for redundancies for operational reasons. Instead, the company is relying on early retirement and severance payments to make the reductions socially acceptable.

Many employees view the development with mixed feelings. Partial retirement has been expanded and, in order to support younger employees, severance payments are being offered for voluntary departures. “It's a hard but necessary step,” explained Human Resources Director Gunnar Kilian at a meeting where CEO Oliver Blume and brand boss Thomas Schäfer were also present, but did not make any comments. The current strategy, which was set out in a restructuring program for the core VW brand, aims to make the company competitive and sustainable by 2029.

Economic challenges

The car manufacturer's move is not only an internal measure, but also a response to the economic conditions. The group is struggling with high costs and overcapacity, especially in the e-car locations in Zwickau and Emden. Sales and profits in China are collapsing, while demand for combustion engine models such as the Golf and Tiguan remains stable. These developments raise alarm bells: According to stern.de, this not only refers to the number of jobs, but also throws the future of many plants in Germany into question.

According to the works council, at least three plants are at risk and the possible closure of production facilities could have significant consequences. Every third production facility could close and possibly even 10,000 jobs could be lost. The most recent company meetings have not only shown the extent of the situation, but have also further fueled the fears of employees. “We have to ensure that a socially acceptable reduction is achieved,” said works council boss Daniela Cavallo, who also warned of a potential four-day week from 2027 if capacity utilization problems persist.

A look into the future

What remains of these challenges? VW is determined not to fall behind in the race for market share. The vehicle manufacturer achieved record sales of 332.3 billion euros in 2023, which corresponds to an increase of 15.5 percent compared to the previous year. However, forecasts for 2024 have been revised downwards as car deliveries are expected to decline. This makes it clear that VW must fight against increasing competitive pressure, particularly from Chinese car manufacturers, without neglecting its own cost structure.

The group emphasizes that the savings process is far from over. There are many tasks ahead to achieve the ambitious goals. At the upcoming industrial summits, in which Federal Chancellor Olaf Scholz will also take part, the necessary measures to secure jobs and promote electromobility will be discussed. The Federal Ministry of Economics has already announced a number of initiatives to support BMW and Volkswagen in this crucial phase, including tax incentives for electric vehicles.

The focus now is on the question: How will VW be able to position itself in the coming years in order to both remain competitive and secure jobs? The next steps will be crucial for the entire industry. It remains exciting!