Volkswagen 2026: the plan to cut 100,000 jobs and close German plants explained

© A. Krivonosov

Volkswagen once again finds itself at the point where talk of “transformation” turns into a fight over factories and jobs. On 9 July the VW supervisory board meets in Wolfsburg to discuss a new savings plan, while IG Metall stages protest actions across every one of the group’s German sites.

The scale of the possible measures is unprecedented. According to Manager Magazin, up to 100,000 jobs worldwide could be cut — twice as many as under the previous plan. Spiegel reported that production at four German sites — Hanover, Emden, Zwickau and Audi’s Neckarsulm plant — could wind down by the end of 2034. VW itself has not confirmed the details, sticking to language about a “future plan” and a “comprehensive transformation”.

For VW this is already the second major conflict in a short span. In late 2024 the group and the union agreed to cut 50,000 jobs in Germany by 2030, of which 35,000 at the core Volkswagen brand. Compulsory redundancies were ruled out at the time, with the emphasis placed on early retirement and severance packages. More than 37,000 employees have already signed such agreements.

Now management considers the previous package insufficient. Group CEO Oliver Blume already spoke in the spring about a new “target picture 2030” and tougher cost cuts. The reasons are on the surface: tariffs, wars, geopolitics and pressure from competitors. But what hurts VW most is that the old business model is breaking down — develop and build in Europe, then sell worldwide at a high margin. Chinese brands, Tesla and local players in key markets no longer leave the previous safety cushion.

Pushing the tougher version through will be difficult. Employee representatives hold significant weight on the supervisory board, and the state of Lower Saxony owns 20% of Volkswagen and also opposes plant closures. Deputy premier Julia Willie Hamburg said outright that shutting factories is not a strategy for the future. That reduces the chances of a quick approval of the plan in its original form.

If the group really does cut capacity, focus will shift to more profitable models, EVs, localisation outside Germany and pruning of complex niche versions. For buyers on the used market this could over time hit availability of certain parts, delivery times and prices for rare trim levels.

VW is no longer arguing about how much to save, but about which piece of the German auto industry it is willing to sacrifice for the next decade.