10.07.2026 07:10
Volkswagen, Europe's largest car manufacturer, is preparing to reduce its model lineup by roughly half and cut annual production capacity to 9 million vehicles as part of restructuring. While the company does not confirm layoff or plant closure claims, it stated that the transformation aims to enhance competitiveness against rising costs and global competitive pressures.
Europe's largest automaker Volkswagen is preparing to significantly narrow its model range and reduce production capacity as part of a comprehensive restructuring plan.
The company aims to reshape its business model due to high costs, increasing competition from Chinese rivals, and pressure from US import tariffs.
In a statement following Thursday's supervisory board meeting, it was reported that the model range will be gradually reduced by approximately half, with the company focusing on the most profitable market segments.
PRODUCTION CAPACITY TO BE REDUCED
As part of the restructuring, Volkswagen plans to reduce its annual production capacity to around 9 million vehicles. It is claimed that CEO Oliver Blume's plan considers laying off up to 100,000 employees and closing four factories in Germany.
Volkswagen has not officially confirmed the allegations of layoffs and factory closures.
WORKERS PROTEST
These allegations led to widespread worker protests at Volkswagen's facilities in Germany on the day of the supervisory board meeting.
During the meeting at the headquarters in Wolfsburg, CEO Oliver Blume reportedly demanded stricter cost cuts across the group, while labor unions, strongly represented on the board, opposed these plans.
COMPETITIVE PRESSURE INCREASES
The 89-year-old German automotive giant has recently faced pressure from the rise of Chinese electric vehicle manufacturers, rising labor and energy costs in Europe, and US trade policies.
It is noted that Volkswagen Group, which also includes the Audi and Porsche brands, is undergoing one of the most comprehensive transformation processes in its history to adapt to changing global competitive conditions, and negotiations on the restructuring are expected to continue in the coming period.