The car manufacturer wants to get rid of 8,000 employees as quickly as possible and is offering a “turbo bonus” and “BMW pension”. The interest is great. The group sometimes pays even more than Mercedes and VW.
BMW wants to save around 8,000 jobs by the end of next year and one billion euros annually from 2028, says CEO Milan Nedeljkovic.
The severance payment program provides for two withdrawal deadlines: March 31, 2027 and October 31, 2027; Those who leave earlier receive a “turbo bonus”.
Employees over 55 years of age receive a qualified termination certificate and special benefits as “BMW pensioners”.
The interest in the program was apparently so great that BMW has to pause the offers initially in order to process the expressions of interest received.
There is great demand for the severance pay program from Germany's largest premium car manufacturer BMW - very large in fact. At the start, so many employees wanted to know what their departure was worth to the company that the employee portal collapsed. The Handelsblatt reported on the breakdown. The first cases now show how much BMW pays employees for their farewell compared to the industry.
Insiders from industry circles report individual cases in which BMW agreed to payments of more than 650,000 euros. A BMW spokesman declined to comment on the amount. “We generally do not comment on individual severance payments or contract details,” BMW said upon request.
However, a sample termination agreement available to Handelsblatt shows how the group organizes the farewell - from the type of payment to the company car. The document is entitled “Model termination agreement for personnel structure program”. The note “Confidential” is written at the bottom.
In many cases, the severance payments amount to well into the six-figure sums. The contract does not contain a transparent formula for how the severance payments are calculated. The important factors probably include age, earnings and length of service. The DAX group announces that the conditions were determined on an individual basis and using uniform principles.
The large sums can be explained primarily by the great pressure to save and the ambitious schedule of the management at the Munich headquarters. According to company circles, BMW plans to save 8,000 jobs by the end of next year. Accordingly, CEO Milan Nedeljkovic plans to save one billion euros annually from 2028.
BMW wants to proceed according to the principle of so-called double voluntariness. This means that both the employee and the company must agree to the departure.
BMW is therefore also putting pressure on speed. The group sets two deadlines for leaving: March 31, 2027 and October 31, 2027. Anyone who leaves earlier will receive a surcharge. This “turbo bonus” is intended to encourage employees to make decisions more quickly. According to the model contract, the program will expire at the end of October 2027. A BMW spokesman did not want to comment on the deadlines.
Quick exits and higher bonuses are common in the industry. There have also been “turbo bonuses” in the severance pay programs of Mercedes and Volkswagen in the past. When it comes to the amount, BMW is higher at 650,000 euros.
For comparison: Wolfsburg's competitor Volkswagen gave around 404,700 euros as part of the program two years ago - without the “turbo bonus”. Last year, the Stuttgart car manufacturer Mercedes offered team leaders with many years of experience around half a million euros.
According to the model termination agreement, BMW offers five options for paying out the severance payment:
a one-time payment,
a partial payment in installments,
a partial contribution into the existing pension account for the employees,
a partial amount in a direct insurance policy that exists for employees
and a combination of the previous options.
The contract also regulates additional privileges for the departing BMW employees. This means they will receive a “benevolent, qualified certificate of completion” if they want a certificate.
According to the notes, paragraph eleven of the model contract only applies to those employees who have reached the age of 55 by the end of the program on October 31, 2027 at the latest. These employees are then treated equally to the so-called “BMW pensioners” when it comes to some additional benefits.
Anyone who retires from BMW enjoys some privileges even after their working life. Some of these are also offered as part of the severance pay program. These include employee conditions when purchasing new or used cars.
Number twelve is relevant for BMW employees who particularly value their company car. There the company regulates what happens to the company vehicles of departing colleagues. Privileges are particularly enjoyed by those employees who belong to certain pay levels that are not covered by collective agreements.
BMW gives some of them the chance to purchase their last company vehicle based on the applicable requirements. The contract does not specify what these are. The offer is valid for the month in which the employment relationship ends. Higher-ranking employees can even purchase a second car this month.
The group's program started last week. On October 8th, BMW sent tens of thousands of BMW AG employees in the so-called indirect area an email with a link to the group's personnel portal. There you could see the amount of the severance payment.
The AG is the parent company of the group and most of its employees are employed under its umbrella in Germany. In total, the company employed a good 85,800 people at the end of last year.
However, interest in the offers was too high and the program started with a technical glitch. The employees were unable to view the offers for hours. The next day the problem was solved.
BMW said the program generated a lot of interest in the days after the personal terms and conditions were sent out. The rush is now so great that BMW has to prioritize. According to company circles, the focus is now on processing the expressions of interest received. Bayerischer Rundfunk first reported on it.
The reason for the job cuts is, among other things, the slump in China, the group's most important individual market. In the third quarter, deliveries there fell by around a quarter. The development has been weighing on the company's results for a long time. In mid-June, BMW issued a surprisingly clear profit warning for the current year.
A little later it became known that the company and the works council were negotiating a reduction program. After a good six weeks, both sides had reached an agreement. At the end of July, BMW CEO Milan Nedeljkovic announced the dismantling at a works meeting in the group's Research and Innovation Center (FIZ).
