- Volkswagen is reportedly eyeing steep cost cuts.
- EV adoption lag and tariffs hurt operating profits.
- Layoffs and plant closures could be a possibility.
In late 2024, the Volkswagen Group announced steep cuts that would see more than 35,000 people lose their jobs in Germany by 2030. The move spelled the end of the Transparent Factory and will eventually see Golf production move to Mexico.
Unfortunately, Volkswagen isn’t done as Manager Magazin is reporting the company wants its brands to cut costs by 20 percent. That’s a sizable amount and the automaker reportedly wants this done by the end of 2028.
More: VW Confirms More Than 35,000 Job Cuts In Germany, Golf Production Moving To Mexico
Plans for steep cuts were reportedly presented in January by Volkswagen AG CEO Oliver Blume. There’s no word on specifics, but it’s believed plant closures are on the table. That remains to be seen, but previous reports have indicated earlier cost cutting measures – at the company’s Wolfsburg, Emden, and Zwickau plants – didn’t live up to expectations.
When asked for comment, a company spokesperson told Reuters that earlier measures unlocked savings in the “double-digit billion-euro range.” They added this has enabled the company to mitigate the impacts of geopolitical issues such as tariffs.
While tariffs are a big issue in Europe and the United States, they’re far from the only problem. The Volkswagen Group’s big bet on electric vehicles hasn’t exactly paid off as adoption is occurring slower than the automaker anticipated. Of course, this is worse in some markets than others.
The company also faces struggles in China, while software and platform issues have been a sore spot. These problems and expenses have been a drag on the group, pushing their operating profit down 33 percent in the first half of 2025. At the time, the company revealed US tariffs cost them $1.5 (€1.3) billion.
