Friday, October 31, 2025

Volkswagen Faces Potential Job Cuts Amid Cost-Reduction Efforts

German automaker Volkswagen (ETR: VOW3) is grappling with financial challenges that may lead to significant job cuts, according to recent reports. While the company has denied claims of plans to lay off up to 30,000 employees, it acknowledges the need to reduce costs at its German locations.

“One thing is clear: Volkswagen has to reduce its costs at its German locations. This is the only way the brand can earn enough money for future investments,” a VW spokesperson said, noting that VW could not confirm the reported figure. “How we achieve this goal together with the employee representatives is part of the upcoming talks.”

German business magazine Manager Magazin earlier reported that VW could potentially cut up to 30,000 jobs in Germany in the medium term. The report also suggested that Chief Financial Officer Arno Antlitz plans to reduce the company’s investment budget for the next five years to €160 billion, down from the previously set target of €170 billion for 2025-2029.

VW’s core brand, VW Passenger Cars, is struggling with high costs, prompting the company to terminate its long-standing job security agreement with German unions. This move has put plant closures and layoffs on the table as potential cost-cutting measures.

Brand chief executive Thomas Schäfer aims to increase the operating return to the target level of 6.5% in the coming years. Negotiations with the trade union IG Metall are set to begin next week.

According to Manager Magazin, the research and development departments may face significant cuts. Of the approximately 13,000 employees in these areas in Germany, an estimated 4,000 to 6,000 might be affected. The report suggests that partial retirement and severance payments alone would not be sufficient to cover the proposed reductions.


Information for this story was found via the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

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