Volkswagen Heads for Showdown: UBS Forecasts Billions in Charges as Workers Mobilize Against Plant Closures
Published on 07/08/2026 at 15:14 | Redaktion boerse-global.de
Analysts at UBS are bracing for a multibillion-euro profit warning from Volkswagen, as the carmaker’s supervisory board prepares to vote on a restructuring plan that could shutter four German plants and eliminate up to 100,000 jobs globally. The Swiss bank estimates provisions for the cost-cutting programme will land in the mid-to-high single-digit billion range, a charge that would hammer near-term operating margins. Markets are already pricing in the pain: Volkswagen’s ordinary shares slid 1.6% to €74.54 on Wednesday, while its preference shares dropped 3.1% to €73.42, leaving the stock down roughly 30% since the start of the year.
The board meeting on Thursday coincides with a nationwide day of action called by IG Metall, with rallies planned at plants in Zwickau, Chemnitz, Dresden, Hannover, Emden, and Neckarsulm. Union chief Christiane Benner described the protest as “a clear signal to the board: not with us.” The state of Lower Saxony, which holds a 20% stake and a blocking minority under the so-called VW Law, has already rejected any permanent plant closures. With employee representatives currently holding a majority on the supervisory board, a rejection of management’s proposals could escalate into an extraordinary general meeting where shareholders would vote directly on the savings package.
CEO Oliver Blume is simultaneously pursuing a deeper structural overhaul that would weaken the VW Law’s grip on strategic decisions. Under the plan being examined, the core Volkswagen brand and the components division would be spun off into separate legal entities, leaving Volkswagen AG as a pure holding company. The move would reduce Lower Saxony’s ability to block decisions on sites and employment, giving management more latitude to respond to the competitive pressure from Chinese rivals. However, the risk of a direct clash between the board and the state government has rarely been higher.
Should investors sell immediately? Or is it worth buying Volkswagen?
Technically, the stock remains under severe pressure. Volkswagen’s ordinary shares are trading well below their 50-day moving average of €84.72 and their 200-day line of €93.97 — a full 31% off the 52-week high of €109.10 set last December. The relative strength index of 35.8 suggests the stock is approaching oversold territory, but traders have so far found no reason to step in without a clear resolution to the boardroom deadlock. The preference shares show an even more stretched RSI of 33.8.
Despite the turmoil, the valuation continues to attract bargain hunters: the preference shares trade at a price-to-earnings multiple of just 7.78, a level that typically signals deep operational distress rather than a simple market dip. Analysts remain divided — JPMorgan recently reiterated an overweight rating on Porsche, a sibling under the same VW umbrella, but the outlook for Volkswagen itself is overshadowed by the sheer scale of the restructuring needed. If the supervisory board approves the plan on Thursday, the UBS-flagged profit warning is expected to follow swiftly. If it blocks the move, the fight moves to an extraordinary shareholder meeting, prolonging the uncertainty that has haunted the stock all year.
Ad
Volkswagen Stock: New Analysis - 8 July
Fresh Volkswagen information released. What's the impact for investors? Our latest independent report examines recent figures and market trends.
Disclaimer regarding our articles: No investment advice, no buy or sell recommendation. Information on prices, companies, and markets is provided without guarantee; changes are possible at any time. Stock market transactions can lead to substantial losses. Our articles are created and reviewed in whole or in part automatically with the support of AI.
