Volkswagen Group plans to eliminate around 50,000 jobs in Germany as part of a broader restructuring effort aimed at improving efficiency and reducing costs across its brands.
Group chief executive Oliver Blume outlined the scale of the job reductions in a letter to shareholders published alongside the company’s 2025 financial results.
The planned workforce reductions affect multiple divisions, including the Volkswagen passenger car brand, Audi, Porsche and the group’s software subsidiary Cariad.
According to the company’s annual report, Volkswagen Group employed approximately 293,000 people in Germany at the end of 2024. If the announced measures are implemented as planned, the workforce could decline to roughly 250,000 employees, although some new hiring is expected to continue during the transition.
Most of the job cuts are expected to occur within the Volkswagen core brand. In late 2024, the company reached an agreement with trade unions to reduce 35,000 positions in Germany by 2030 as part of a restructuring programme for the main passenger car division.
Other brands within the group are also under pressure to cut costs. At Porsche, profitability has recently declined after several years of strong earnings, prompting leadership changes and the appointment of Michael Leiters, allowing Blume to focus more directly on managing the broader Volkswagen Group transformation.
Financial results for 2025 highlight the challenges facing the automaker. Group sales remained largely stable at €321.9 billion, compared with €324.7 billion in 2024, representing a decline of 0.8%. However, operating profit dropped sharply to around €8.9 billion, while net income fell 38% to €6.7 billion.
The group’s operating margin declined to 2.8%, its lowest level since 2016 during the fallout from the Volkswagen emissions scandal.
Blume has indicated that deeper cost reductions will be required to address the company’s financial challenges. Speaking during the results presentation, he said the group would “leave no stone unturned” in its transformation programme.
“We are talking about a programme that will address all areas of the company,” Blume said, adding that the plan will cover development, procurement, production, sales, and quality management.
As part of the restructuring, Volkswagen is centralising several key functions within the group. Divisions including Group Procurement, Group Production and Group Sales will report directly to Blume from April 1, joining the already centralised Group Development unit.
Previously, some of these functions were managed at the brand level. For example, the group’s sales division had been part of the Progressive brand group, which includes Audi as well as luxury marques Bentley and Lamborghini.
The structural overhaul follows the end of Blume’s dual leadership role at Volkswagen and Porsche and is intended to strengthen decision-making within the group.
“Our future group steering model is based on the principle of a strategically operational group with strong brands,” Blume said. “With the new structure, we are creating the conditions to enhance operational excellence, increase efficiency and quality, and reduce costs.”