Audi has announced plans to cut up to 7,500 jobs in Germany by 2029 as part of a sweeping austerity program aimed at reducing costs and improving efficiency. The Volkswagen subsidiary stated that job reductions will focus primarily on non-production roles and will be implemented in phases, with 6,000 jobs to be cut by the end of 2027, followed by 750 additional job cuts in each of the following two years.
Despite these reductions, Audi reaffirmed its commitment to strengthening its German operations by investing €8 billion in its domestic production facilities, particularly in electric vehicle (EV) manufacturing.
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The automaker’s restructuring plan comes as it faces declining sales and profitability pressures. In 2024, Audi reported a 12% drop in global deliveries, with sales falling to 1.67 million units. Electric vehicle sales were also hit, declining by 7.8% to 164,500 units, representing just under 10% of the company’s total sales.
Audi has struggled particularly in key markets such as the United States and China. In China, where competition from local EV manufacturers has intensified, Audi is now attempting to reposition itself by launching a new sub-brand that will sell EVs without the traditional four-ring logo.
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The company’s cost-cutting strategy includes adjustments to employee bonuses and reductions in management salaries, but it also incorporates investment commitments. Audi plans to introduce a new, as-yet-unspecified electric model at its Neckarsulm facility, which currently does not produce any EVs apart from the high-end e-tron GT at its affiliated Böllinger Höfe plant.
Additionally, the company will expand its electric lineup at its main Ingolstadt plant, adding an entry-level EV alongside the A6 e-tron and Q6 e-tron. However, Audi’s future production plans remain subject to approval from Volkswagen Group’s planning committee.
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To ensure workforce stability, Audi has extended its job security program until the end of 2033 and pledged to mitigate job losses by bringing back previously outsourced activities, particularly in development services.
In a notable shift from previous plans, Audi announced that combustion engine production at Ingolstadt will continue until 2033 instead of ending in 2030 as originally intended. The automaker also indicated that it will continue investing in internal combustion engine technology beyond 2026, when further development of petrol and diesel models was initially set to be discontinued.
This suggests that Audi may be reconsidering its overarching strategy to transition exclusively to EVs in Europe by 2033, two years ahead of the EU’s mandated phase-out of new combustion engine sales.
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Audi’s financial performance has lagged behind industry expectations, with the company achieving only a 2.5% return on sales in the first three quarters of 2024—significantly below the profitability levels expected for a premium automaker. The company aims to achieve “high single-digit” returns by the end of the decade, and the latest cost-cutting measures are designed to help it reach this target.
“Audi’s restructuring is an important milestone for securing the future of the company and its workforce,” said CEO Gernot Döllner. “Together with employee representatives, we are strengthening our competitiveness and setting a clear path for greater efficiency, focus, and profitability at our German sites.”
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The broader automotive industry is undergoing a period of significant restructuring, with several German manufacturers implementing large-scale job cuts. Volkswagen previously announced plans to reduce its workforce in Germany by 35,000 jobs by the end of 2024, while Porsche, Mercedes-Benz, and major suppliers such as Bosch, ZF, and Continental are also implementing cost-saving measures. Audi’s restructuring efforts come at a critical time, as the company seeks to navigate an evolving market landscape while balancing investments in electrification with the realities of declining sales and profitability pressures.