The logo of Volkswagen is pictured on February 19, 2026 in Berlin, Germany. (Photo by Florian Gaertner/Photothek via Getty Images)
Volkswagen is weighing a dramatic restructuring that could include closing four factories in Germany and eliminating up to 100,000 jobs, according to two sources familiar with the matter that told Reuters.
If approved, it would represent the largest overhaul in the company's history and one of the biggest restructurings ever seen in the automotive industry.
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Dig deeper:
The proposed measures have already been presented to members of Volkswagen's supervisory board and are expected to be discussed at a meeting on July 9, the sources said.
The German automaker is under increasing pressure from several fronts, including fierce competition from Chinese manufacturers, U.S. tariffs on imported vehicles, and weakening demand across Europe. Volkswagen has previously warned that these challenges have made its current business model increasingly difficult to sustain.
Why you should care:
The plans reportedly include shutting factories in Hanover, Zwickau, Emden, and Audi's Neckarsulm facility, putting more than 45,000 jobs at risk. Combined with roughly 50,000 layoffs already planned, total job losses could reach 100,000.
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Big picture view:
Such a move would surpass previous automotive restructurings in scale. It would rival General Motors' restructuring during and before its 2009 bankruptcy, as well as its downsizing in the early 1990s, when the U.S. automaker eliminated as many as 74,000 jobs over four years and closed or idled 21 plants.
Volkswagen CEO Oliver Blume reportedly presented the proposal to senior executives earlier this week in an effort to build internal support before facing expected opposition from labor unions and the state of Lower Saxony, Volkswagen's second-largest shareholder.
Manager Magazin first reported the restructuring plans, adding that Volkswagen intends to reduce planned investments by around 15% to just over $148 billion over the next five years.
What's next:
According to the magazine, Blume and Chief Financial Officer Arno Antlitz are pursuing a broad reorganization of the 89-year-old company that could include spinning off the core Volkswagen brand and its parts operations into separate businesses.
What they're saying:
A Volkswagen spokesperson declined to comment on what the company described as "confidential documents."
"The entire group, including its brands and subsidiaries, must undergo far-reaching change," the spokesperson said.
Volkswagen's works council and Germany's influential IG Metall union pledged to oppose the proposed restructuring. In a joint statement Friday, they said: "Should such plans go ahead, we would do everything in our power to prevent them."
The premier of Lower Saxony also rejected the proposal, saying the state would not support it.
Porsche SE, the investment company controlled by the Porsche and Piech families and Volkswagen's largest shareholder, declined to comment. The proposed restructuring is expected to renew scrutiny of Volkswagen's governance model, which grants significant influence to labor representatives and the Lower Saxony government.
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The backstory:
Volkswagen employed 667,164 people globally during its 2025 financial year, with nearly 43% of its workforce based in Germany.
Blume previously attempted to close German factories in 2024, but strong resistance from labor unions forced the company to abandon those plans.
At the time, management considered closing or selling several facilities as part of a broader cost-cutting strategy aimed at reducing excess production capacity and responding to slowing electric vehicle demand. The proposal sparked strikes and a prolonged standoff with IG Metall and the works council, both of which wield considerable influence within the company.
The Source: This story is based primarily on Reuters reporting, which cited two sources familiar with Volkswagen's restructuring plans. This story was reported from Los Angeles.