Volkswagen Mulls Massive Restructuring, Up to 100,000 Job Cuts

German automaker Volkswagen is considering one of the biggest efficiency drives in its history, according to a report in the German magazine Manager Magazin. The plan under review could eliminate up to 100,000 jobs worldwide, split the core Volkswagen brand into a separate entity, close factories, and cut investments by tens of billions of euros.

The report says CEO Oliver Blume and CFO Arno Antlitz are preparing a strategic plan for 2030 aimed at making the group leaner and more profitable as the car industry undergoes major change. At the center of the proposal is a reduction of up to 100,000 workers, about 15% of the group’s workforce, along with separating the Volkswagen brand operations and the parts-making division into distinct entities.

Volkswagen is also said to be weighing the closure of four production sites in Germany, including plants in Hanover, Zwickau and Emden, plus an Audi factory in Neckarsulm. The models currently built there would be phased out. In addition, the company plans to reduce investment over the next five years by about 15%, to a little more than 130 billion euros.

The move comes as European carmakers face intensifying competition from Chinese manufacturers and pressure on profitability. Volkswagen has announced several restructuring plans in recent years, but if this one is carried out, it would be the largest yet. The report says German labor unions are expected to resist, partly because the plan would go beyond last year’s agreement under which Volkswagen pledged not to close factories in Germany over the next decade.