Volkswagen is reportedly planning to cut 100,000 jobs and shut down four of its manufacturing plants in Germany over the coming years, a report has said. According to Germany’s Manager Magazin (via CNBC), the cost-cutting blueprint marks the most radical overhaul in the automaker’s 89-year history.The report says that the proposal says Europe’s largest carmaker will shed roughly 15% of its massive global workforce. The restructuring is a response to intensifying competition from Chinese electric vehicle brands that are eating into Volkswagen’s market share.According to a report by news agency Reuters, Volkswagen CEO Oliver Blume presented the plans to senior executives earlier this week.
Severe cuts and halted production
In addition to the layoffs, the Wolfsburg-headquartered company plans to slash its future research and development investments by 15% – reducing its five-year budget to just over 130 billion euros ($148.2 billion). The report notes that Volkswagen intends to cease production at three of its main German facilities, which are located in Hanover, Zwickau and Emden, alongside the closure of luxury subsidiary Audi’s manufacturing site in Neckarsulm.Volkswagen had previously hinted at workforce reductions, and was reportedly expected to cut around 50,000 German jobs by 2030. The new plan effectively doubles that figure.
Pressure from rising Chinese EV rivals
Reuters reported that Blume is under pressure to revive Volkswagen’s fortunes as it battles US tariffs and growing competition from Chinese automakers, its biggest threat. Major automakers have steadily lost ground to locally produced EVs in China. Citing AlixPartners data, the Reuters report notes that non-Chinese automakers’ market share fell to 32% in 2025 from 57% in 2020.Volkswagen was overtaken by BYDin 2024 and fell to third place in 2025. That decline has now spread to premium automakers like BMW, which also partly blamed China for a shock profit warning last week. Chinese automakers are also expanding into emerging markets and are growing rapidly on Volkswagen’s home turf in Europe.BYD, Chery, SAIC and Leapmotor doubled their combined European market share through May from a year ago, according to ACEA.
VW says, ‘profound change required’
When contacted by CNBC, a spokesperson for Volkswagen declined to comment directly on what they called “internal, confidential documents,” noting that any final decisions would have to be officially approved by the company’s governing boards.However, the spokesperson acknowledged the pressure the automaker is under, saying “The entire Group, including its brands and subsidiaries, must undergo profound change.”According to internal financial data, Volkswagen maintained a colossal workforce of approximately 657,400 employees globally at the end of the first quarter of 2026.
