Volkswagen Reportedly Plans Up to 100,000 Job Cuts and Plant Closures Amid EV Shift and Chinese Competition

Germany’s Volkswagen is to cut up to 100,000 jobs and reduce and eventually stop production at some plants, according to reports.

The company has refused to comment on reports of a management presentation at a board meeting outlining dramatic cost cutting, but if it goes ahead it would mean Volkswagen doubling previously announced staff reductions.

The carmaker employs more than 650,000 people across all its brands, which include Audi, Bentley, Skoda, Seat and Cupra, and has been hit hard by growing Chinese competition and the struggle to shift to electric cars from combustion engines.

A spokesperson for Volkswagen said it would not “pre-empt the process”, a sensitive one involving staff and their unions.

However, they pointed to the already widely reported challenges to legacy brands facing competition from more nimble Chinese rivals that have made huge inroads into Europe with electric vehicles and more recently plug-in hybrid cars.

“It is correct that the entire automotive industry and the Volkswagen Group are undergoing a profound transformation. The executive board has repeatedly stated that our current business model no longer works across all brands: developing cars in Germany, producing them in Europe and exporting them to the world. The world has fundamentally changed in recent years,” the spokesperson said.

According to Germany’s Manager Magazin, the VW chief executive Oliver Blume’s deepening overhaul will be discussed at a supervisory board meeting next month.

He has already announced a strategy aimed at cutting €11bn (£9.49bn) from costs.

On Friday the spokesperson cited tariffs, competition and “stagnating, sometimes declining” markets that can create “burdens on the company reaching tens of billions of euros per year”.

The magazine said the proposals, which could be watered down, currently involve the closure of four German factories in the medium term.

They include an Audi site in Neckarsulm as well as VW plants in Hanover, Zwickau and Emden. The cuts are significantly deeper than those announced in 2024.

To survive the competition, the company has to adapt, and that “requires a sharper focus” on costs and investment, the spokesperson said.

“The entire group, including brands and subsidiaries, have to transform profoundly,” they added.

The group has been making some headway against rivals in China itself.

In March, it reclaimed car sales dominance in China, the world’s largest auto market, in the first two months of 2026, when Toyota also regained ground, both overtaking the local electric vehicle champion BYD amid fading subsidies for greener cars.

However, earlier this month BYD’s boss said it aimed to become the world’s largest auto company, wanting to take the crown long held by Toyota within five years.

VW’s Chinese joint ventures with FAW and SAIC held a combined 13.9% share of the country’s passenger vehicle market in sales ​terms, followed by Geely’s 13.8% and a combined 7.8% from Toyota’s ​joint venture with GAC and FAW, data from the China Passenger ⁠Car Association showed.