Volkswagen to cut 100,000 jobs by 2030
What's the story
Volkswagen, the German automotive giant, has announced plans to cut 100,000 jobs by the end of this decade. The decision comes as a response to US tariffs and stiff competition from Chinese rivals. The company said that management and unions have agreed on a cost-cutting plan that will see "the reduction of around 50,000 jobs," on top of another 50,000 already agreed.
Product reduction
Volkswagen to halve product line
Along with the job cuts, Volkswagen has also announced plans to halve its product line.
The company produces a wide range of car models under various brands, including Bentley and Audi.
As part of this restructuring effort, four production plants in Germany could be closed within the next eight years.
Leadership challenges
Backlash from employees
Volkswagen's CEO Oliver Blume faced backlash from employees during a recent visit to the company's headquarters in Wolfsburg, Germany.
The visit was part of a dialog about the company's financial struggles and potential restructuring plans.
Despite the criticism, Blume's proposed measures to increase job cuts from 50,000 to 100,000 have been approved by VW Group's supervisory board representing labor and shareholders.
Historic restructuring
Largest restructuring in automotive industry
The total of 100,000 job cuts will be the largest restructuring exercise in the global automotive industry.
It will account for about 15% of Volkswagen's workforce across all its brands, which include SKODA, Seat, Porsche, Cupra, and Lamborghini.
The company currently employs over 650,000 people worldwide.
Plant closures
Volkswagen's full-scale factory closures in Germany
Volkswagen has also revealed that the future of four German plants, Hannover, Emden, Zwickau and Neckarsulm, could not be guaranteed into the 2030s.
This would be the first time Volkswagen has closed full-scale factories in its home country.
The decision comes amid increasing pressure from fierce Chinese competition in Europe, declining sales in China, and hefty US tariffs.