Volkswagen plans to cut 35,000 German jobs

Volkswagen AG is announcing significant job cuts as part of a major restructuring. Since December, the company plans to reduce its workforce in Germany by 35,000 over the next five years. Additionally, it will cut 1,900 jobs at Porsche and 7,500 at Audi, and downsize its software division by about a third. Despite these reductions, Volkswagen will still employ more people than its major competitors. At the end of last year, Volkswagen had 679,472 employees, although this was a slight decrease from 2023. In comparison, Toyota had 384,338 employees, and Volkswagen's workforce in Germany alone was more than the total staff of Stellantis, Europe's second-largest carmaker. CEO Oliver Blume has been working to make Volkswagen more efficient. He recently made an agreement with the company’s powerful works council that is expected to save about €4 billion ($4.3 billion) each year. However, Volkswagen has avoided more drastic changes, like closing several plants in Germany. The company hopes that increased government spending in Germany will help boost the economy after it faced challenges over the past two years. Many companies in the region have reduced staff due to factors like rising energy costs and decreasing demand. Making job cuts is challenging for Volkswagen because worker representatives have significant influence in decision-making. The company still produces many components in-house and plans to increase its electric vehicle battery production, contributing to its large workforce. However, company leaders warn that declining sales in Europe may mean Volkswagen has too many factories. To meet its staffing goals, Volkswagen is likely to rely on attrition and retirements, allowing positions to be left unfilled under strict German labor laws.