Volkswagen Considers Cutting 100,000 Jobs in Largest Restructuring in European Auto History

Volkswagen Group is considering one of the most extensive restructuring plans in the history of the European automotive industry, which may involve cutting up to 100,000 jobs and halting production or closing several plants in Germany, as part of a cost-reduction strategy to regain competitiveness against Chinese rivals. According to news reports, the figure is not yet a final decision but a proposal under discussion within the group, facing strong opposition from worker representatives and lacking final approvals from company authorities.

Chinese Competition Hits the Group's Key Market

Volkswagen faces mounting pressure in the Chinese market, which for years was one of its primary sources of sales and profits, after local companies such as BYD, Geely, and Xiaomi succeeded in offering more advanced electric vehicles at competitive prices. The rise of Chinese brands has eroded the market share of foreign automakers in China, while these same competitors are expanding into Europe, presenting the German group with a dual challenge both in its largest market and abroad.

The group's global deliveries fell by 8.6% in the second quarter of 2026, while the decline in China exceeded 36%, increasing pressure on management to accelerate cost-cutting and capacity reduction measures. The need for deep restructuring has become urgent as the global automotive landscape shifts, with China transforming from a key market into a direct competitive threat.

100,000 Jobs at Risk

The proposals being circulated suggest a doubling of previous workforce reduction plans, potentially eliminating around 100,000 jobs globally in the coming years. This figure represents roughly one-sixth of the group's total workforce, making the plan, if implemented, one of the largest waves of layoffs in automotive industry history. However, Volkswagen has refrained from officially confirming the number, stating that discussions are still ongoing and that any final decisions require internal approvals and negotiations with employee representatives.

Four German Plants in Jeopardy

Scenarios under consideration include halting production or finding new uses for four German plants, with facilities in Hanover, Emden, Zwickau, and Neckarsulm reportedly among those potentially affected. This does not necessarily mean permanent closures, as the group is exploring options to convert some plants for other models, bring in new partners, or repurpose them for different industrial activities, aiming to mitigate the social and economic impact of the planned restructuring.