More efficient plants, leaner structures
How Volkswagen wants to become more competitive again
Volkswagen is tightening its cost-cutting course. The Group wants to reduce overcapacity, realign production networks and cut around 50,000 jobs across the Group by 2030. The measures are intended to save more than €6 billion ($6.9bn) annually.
The Volkswagen Group is continuing to push ahead with its far-reaching restructuring. At the annual general meeting, Group CEO Oliver Blume presented a future plan that is aimed above all at reducing overcapacity, reducing complexity and creating a more efficient production structure. By 2030, this is expected to generate annual net savings of more than €6 billion ($6.9bn). The basis for this includes, among other things, job reduction programmes, capacity adjustments and a streamlining of the Group organisation.
“We are making the Volkswagen Group even more robust and competitive,” said Blume. The aim is to position the company to be “even more future-proof in terms of costs, structure and technology”.
Production capacities will be reduced further
From the perspective of industrial manufacturing, the adjustment of the production network is one of the central levers of the programme. Volkswagen announces that it will continue to consistently reduce the existing overcapacities. The production network is in future to be aligned more closely with actual market requirements and to operate more regionally, efficiently and economically.
Overcapacities are to continue to be reduced - the goal is a regional, intelligent and economical production network
As the third strategic field of action, Blume explicitly cites the realignment of the production network: “Overcapacities are to continue to be reduced - the goal is a regional, intelligent and economical production network.”
At the same time, model and variant diversity is to be reduced and platforms and electronic architectures are to be standardised to a greater extent. From a production perspective, the Group expects this to result in higher volumes per vehicle model, less complexity in the plants and lower development costs.
50,000 jobs are under consideration
The personnel measures already agreed make a significant contribution to reducing costs. For Volkswagen, Audi, Porsche and the software subsidiary Cariad, the reduction of around 50,000 jobs has been agreed. At Volkswagen AG alone, 35,000 jobs are to be cut. According to Group information, more than 28,000 departures by 2030 have already been bindingly agreed.
Volkswagen emphasises that collective bargaining agreements and staff reductions are already having an effect. For the year 2025, the Group puts the sustainable cost effects at around €1 billion ($1.15bn). Together with the planned capacity reductions, the savings are to rise significantly by 2030.
Progress has also been made at the German Volkswagen sites. According to the company, factory costs were reduced in 2025 alone by more than 20 per cent on average.
Saving as a response to weak earnings
The tightened restructuring course is taking place against the background of persistently difficult business development. The Volkswagen Group started 2026 with a renewed decline in profit. In the first quarter, the Group's profit after tax fell by 28.4 percent to €1.56 billion ($1.8bn). Revenue simultaneously declined by 2.5 percent to €75.7 billion ($87bn). The operating return on sales was only 3.3 percent.
Business is being burdened in particular by declining deliveries in China and North America, increasing competitive pressure from Chinese manufacturers, as well as additional trade barriers. Group CEO Blume recently referred to “wars, geopolitical tensions, trade barriers, tighter regulation and tough competition” as key burdening factors.
Chief Financial Officer Arno Antlitz had also stated that the additional US tariffs burden the Group by around $4 billion ($4.6bn) per year. Against this background, the cost-cutting programmes defined so far were no longer sufficient.
Return target: eight to ten percent
With the future plan, Volkswagen is pursuing the goal of becoming significantly more profitable again by 2030. The aim is an operating return on sales of between eight and ten percent. At the same time, the net cash flow in the core automotive business is to rise significantly.
“The situation remains challenging. Nevertheless, we still have it in our own hands,” said Blume at the annual general meeting. For the coming years, Volkswagen is relying above all on a leaner organisation, lower costs and stronger utilisation of its production structures.
