Volkswagen Slashes Model Range by Half but Keeps Silence on Plant Closures, Stoking Worker Anger
Published on 07/10/2026 at 06:35 | Redaktion boerse-global.de
Volkswagen’s supervisory board approved the most aggressive product rationalisation in the company’s modern history on Thursday, but left the fate of thousands of jobs hanging in the balance — a combination that sent workers into the streets and failed to reassure investors. The carmaker plans to shrink its model portfolio by as much as 50% and cut available equipment options by up to 75%, stripping away years of complexity that have weighed on profitability.
Yet the board said nothing about which factories might close or how many jobs could go. Media reports have put potential cuts at 100,000 positions, including 50,000 new redundancies on top of previously announced reductions, with four German plants — Hannover, Emden, Zwickau and Audi’s Neckarsulm site — under review for possible shutdown. Managers presented 12 initiatives to turn the group around, but the personnel decisions that will determine the plan’s credibility remain undecided.
The omission ignited protests at more than a dozen locations. In Emden, the IG Metall union counted 1,500 demonstrators, while 500 employees gathered outside the Wolfsburg headquarters. Works council chairwoman Daniela Cavallo reacted furiously after the meeting, and IG Metall chief Christiane Benner rejected any plant closures outright, demanding binding commitments to protect domestic production.
Lower Saxony’s minister-president Olaf Lies, who sits on the board, confirmed that discussions had been “very intensive” and ruled out plant closures as a strategic option for the future. That statement contradicts the management’s internal examination of the four sites, highlighting the deep divisions inside the boardroom. The state and labour representatives together hold blocking minorities, a power constellation that has derailed previous restructuring attempts.
Should investors sell immediately? Or is it worth buying Volkswagen?
The capacity data underscore the urgency. According to Mobility Global, Volkswagen’s German factories are currently running at only 81% utilisation. The outlook for Zwickau is particularly bleak: utilisation there could plunge to a mere 42% by 2030 as demand for EVs softens and Chinese competitors seize market share. The group is also grappling with high cost bases and fresh U.S. tariffs that are squeezing margins further.
CEO Oliver Blume now faces the unenviable task of reconciling hard savings targets with the social peace that the works council and IG Metall are demanding. The longer the uncertainty over jobs persists, the harder it will be to convince investors that the transformation is on a solid footing.
The stock market is already voting with its feet. Volkswagen’s preferred shares closed Thursday at €72.30, leaving them down 31.86% since the start of the year and within striking distance of the 52-week low of €69.20 — a decline of more than 32% from the January open. The 200-day moving average sits 22.98% above the current price, and while the relative strength index of 32.2 signals an oversold condition, no upward catalyst has emerged.
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The supervisory board has sketched the first phase of a radical overhaul, but the real test lies ahead. Until concrete agreements are struck on plant closures and headcount reductions, the equity will lack the foundation needed for a sustained recovery — and the protests at the factory gates will only grow louder.
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