Volkswagen Group is considering what was previously unthinkable: closing four factories in Germany and making layoffs that would reduce the workforce by 15 percent.
2025 was a bad year for Europe’s largest automaker. Its sales were essentially flat, but profits were next to nothing, with operating margins more than halved, falling 44 percent to just 6.9 billion euros ($7.9 billion). It looks like the red ink will continue to bleed through 2026, and in March, the company announced it would cut 50,000 jobs in Germany by 2030 as part of an adaptation plan. Now, according to a report in Manager Magazine, job losses could double.
The automaker sold EVs well in Europe last year, but sales in North America and China fell and continue to fall, and tariffs have had a significant impact.
In April, VW Group CFO and COO Arno Arnitz told investors that the company’s operating margins were “very low” and that it would have to fundamentally change its business model to cut costs and increase efficiency without tanking quality. “This will require significantly reducing the complexity of our product portfolio and technology platforms, as well as the number of entities and decision-making layers involved,” Arnitz said.
<a href