According to VW decisions, experts see a “race for survival” for locations

Zwickau. According to auto industry expert Werner Olle, the latest resolutions by the VW supervisory board are intensifying competition between the threatened locations. “The race for survival has begun,” he told the German Press Agency. Olle sees the challenge not only for the board of directors to find solutions to preserve them, but also for the union and the works council. With an individual future agreement for the Zwickau location, you could reduce labor costs and thus ensure survival. “This was successful in a similar situation in the 1990s.”

In addition to car production, the new circular economy area is currently being set up in Zwickau. However, this only offers prospects for a fraction of the current employees and has far fewer effects for suppliers. Olle also does not see armament as an alternative for the factory, which is geared towards large-scale production. The only sensible way is to continue building cars.

VW's competitor Stellantis, which includes brands such as Opel, Peugeot, Fiat and Citroën, shows how this can work. Like Volkswagen, the company is struggling with overcapacity and reducing employment. In addition to opening up local car factories for the production of Chinese models, the development of new models with Chinese partners could be one way, similar to Stellantis. In the future, a fully electric SUV developed by Opel and Leapmotor will roll off the assembly line in Zaragoza (Spain).

“That would be a new path for VW and Audi,” emphasized Olle. There is still enough time for this until 2030. Such a partnership reduces development time and product costs. From his point of view, this is better than building vehicles from Chinese partners in their own factories. And the VW plant in Zwickau is very well suited for such a step. “It has shown that it is capable of tackling completely new challenges,” said the expert: “It was a pilot work for e-mobility, is a pilot work for the circular economy - why not for such an approach.”

Volkswagen is struggling with falling demand for cars and competition from Chinese carmakers. The Supervisory Board therefore recently gave the green light to cut a further 50,000 jobs worldwide - in addition to the already agreed savings of 50,000 jobs across the group by 2030 in Germany. At the end of 2025, the group had almost 663,000 employees worldwide, including around 284,000 in Germany.

There is particularly great concern at the Emden, Hanover, Zwickau and Neckarsulm locations, which are repeatedly mentioned as candidates for closure. The Supervisory Board had therefore noted that there is an excess production capacity of 500,000 vehicles in Europe and that competitive subsequent occupancy - staggered from 2031 to 2034 - cannot currently be guaranteed for the four plants. Alternatives recently discussed were temporarily using plants for arms production or building Chinese VW models in Germany.

VW made the big mistake of expanding capacity for electric cars without waiting for market developments, says Olle, who is co-founder of the Chemnitz Automotive Institute (CATI) but is no longer a member. In addition to Zwickau, Emden was also converted into an electric car factory. In addition, corresponding production is being set up in Wolfsburg. Olle: “With demand that is far from what was originally planned, you now have several locations fighting for it.”