Volkswagen Faces Twin Crises as Board Rebuffs Blume’s Plan and Qatar Derails Defense Deal
Published on 07/11/2026 at 13:15 | Redaktion boerse-global.de
Volkswagen’s stock is languishing near its 52-week low of €69.20, closing Friday at €71.06 after shedding 1.31% on the day. The shares have lost 17.85% over the past month and 33.03% since the start of 2026, weighed down by two simultaneous blows to the automaker’s restructuring ambitions: a supervisory board that rejected CEO Oliver Blume’s turnaround blueprint, and a key shareholder that has blocked a planned defense manufacturing tie-up with Israeli firm Rafael.
The board’s vote on July 9, 2026 was a stinging defeat for Blume. His “Zukunftsplan” — intended to chart a course through plant closures, job cuts and shrinking market share — was voted down 12 to 7, leaving the company without a formal road map. The rejected proposal called for slashing production capacity by one million vehicles to nine million by 2030, halving the model lineup by 2035, and reducing model variants by 75%. Four German plants — Zwickau, Emden, Neckarsulm and Hanover, which together employ 40,000 people — were placed at risk of closure. Additionally, 5,000 of 21,000 management positions were to be eliminated by 2030. So far, 37,000 workers have accepted severance deals, short of the 50,000 originally targeted.
Resistance to the plan has been fierce, especially from Lower Saxony — which holds 20% of VW shares — and from powerful labor representatives. On July 11, the works council and manager representatives sent a letter to staff demanding personnel changes at the executive board level, criticizing Blume’s communication strategy. Talks are expected to resume after the summer break, but the IG Metall union has already mobilized at 20 locations, warning of a major confrontation.
While the boardroom battle plays out, a separate geopolitical obstacle has emerged. Volkswagen’s plan to manufacture components for Israel’s Iron Dome air-defense system with Rafael — seen as a lifeline for the Osnabrück plant, where T-Roc Cabrio production ends next year — has been blocked by the company’s third-largest shareholder, Qatar. The Qatar Investment Authority, which holds just over 17% of VW shares and has two seats on the supervisory board, vetoed the memorandum of understanding signed in late April. Tensions between Qatar and Israel are cited as the reason, according to reports from Handelsblatt and Bild. The Osnabrück site employs 2,300 people whose future remains uncertain.
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Lower Saxony’s premier, Olaf Lies, who sits on VW’s supervisory board, declined to comment on the specific dispute but said the state would “constructively accompany where it makes sense” any solution. Volkswagen itself has remained tight-lipped, stating only that a decision on the plant’s future has not been made and that economically viable solutions are the priority.
The operational backdrop is grim. Second-quarter sales dropped 9% globally, with China plunging 36.6%. The group’s operating margin had already fallen to 3.3% in the first quarter. In response to the cost pressures, auto expert Ferdinand Dudenhöffer of the CAR Institute has called for a return to the 40-hour week without wage compensation to reduce production expenses. He predicts hard years ahead but expects a recovery within five to seven years.
The product portfolio is also under the microscope. According to forecasts from auto-motor-und-sport.de, models such as the Taigo, ID.5 and T-Roc Cabrio (ending 2027) could be axed; the Touareg has already been discontinued. At Audi, successors for the Q8 and Q4 E-Tron are uncertain, while the A1 and Q2 are phasing out. Seat sales fell 17% in 2025 to 257,400 vehicles, even as sibling brand Cupra hit a record 328,800 units. Skoda is seen as having little room for cuts, and Porsche will stick with its core models: 911, Cayenne and Macan.
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The market’s verdict is visible in every technical indicator. The stock trades 24.22% below its 200-day moving average of €93.78 and well under the 50-day line of €84.11. The relative strength index (14-day) stands at 30.2, signaling deeply oversold territory. Annualized volatility of 32.21% warns of further sharp swings. From its December 2025 52-week high of €109.10, the shares have lost nearly 35%. The market capitalization now hovers around €34.72 billion. Until the power struggle between the board, management, Lower Saxony and labor is resolved — and a viable alternative for Osnabrück is found — uncertainty will continue to hang over Volkswagen’s stock.
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