Volkswagen Group is weighing one of the most sweeping restructuring plans in its corporate history, with Chief Executive Officer Oliver Blume reportedly considering measures that could eliminate up to 100,000 jobs, shutter multiple factories across Germany, and slash investment spending by 15 per cent over the next five years. The proposed overhaul, if approved, would reduce the group's capital expenditure to just above €130 billion.

Scale of the Proposed Overhaul

According to a report by Manager Magazin, the restructuring blueprint is currently awaiting sign-off from the company's board. The latest proposals would go significantly further than Volkswagen's previously announced plan to cut around 50,000 jobs, potentially affecting nearly 15 per cent of the group's total global workforce — making it one of the largest such exercises in the automaker's history.

Among the structural changes under consideration is the separation of Volkswagen's core passenger car brand and its parts division into independent entities. The move is aimed at streamlining operations and improving profitability at a time of mounting pressure on the group's finances.

Plants Facing Possible Closure

Reports suggest that production could eventually be wound down at Volkswagen's Hanover, Zwickau, and Emden plants, as well as Audi's Neckarsulm facility, once current vehicle programmes run their course. These closures, if confirmed, would mark a historic contraction of Volkswagen's German manufacturing footprint — a politically and symbolically significant step for a company deeply intertwined with the country's industrial identity.

What Is Driving the Crisis

Volkswagen has been caught in a multi-front squeeze. US tariffs have raised export costs, while intensifying competition from Chinese electric vehicle manufacturers has eroded market share in a segment the group had bet heavily on. Rising costs tied to the transition to electric mobility have further strained margins. CEO Blume has repeatedly stressed the need to sharpen focus on core automotive operations and restore profitability.

This comes amid a broader reckoning across the European auto industry, where legacy manufacturers are struggling to match the pace and cost efficiency of Chinese EV rivals while simultaneously funding the capital-intensive shift away from internal combustion engines.

Company Response and Labour Opposition

Volkswagen declined to comment directly on the reported internal plans but acknowledged, according to the report, that the entire group must undergo 'far-reaching change' to remain competitive. The carefully worded non-denial leaves the door open to confirmation once board deliberations conclude.

The proposals have already drawn fierce opposition from organised labour. Volkswagen's works council and Germany's influential IG Metall union have both vowed to strongly resist any factory closures or deeper workforce reductions, setting the stage for a protracted industrial confrontation should the plans advance. In Germany, works councils hold co-determination rights that give them formal power to delay or block major restructuring decisions.

What Comes Next

The restructuring plan is reportedly awaiting board approval, and no timeline has been publicly confirmed. Industry analysts will be watching whether Volkswagen can navigate union resistance while executing a transformation that its leadership has framed as existential. The outcome will have significant implications not only for the group's roughly 660,000 employees worldwide but also for Germany's broader manufacturing economy.