Volkswagen is considering closing or winding down production at four German sites in Hanover, Zwickau, Emden and Audi’s Neckarsulm plant, and increasing planned job reductions to as many as 100,000, Reuters reported on June 26, citing sources. The proposal has been presented to members of the supervisory board and is scheduled to be discussed on July 9.
Reuters said the four-site plan would place more than 45,000 jobs at risk, in addition to about 50,000 reductions already planned. Volkswagen’s labor representatives and works council have indicated opposition, and Lower Saxony, which has influence through the company’s governance structure, has also signaled resistance.
In December 2024, Volkswagen announced a competitiveness agreement that included a lasting reduction of 734,000 units of production capacity at German plants, a workforce reduction of more than 35,000 in Germany by 2030, labor-cost savings of €1.5 billion a year and medium-term annual cost effects of more than €4 billion. The company’s 2024 annual report said a prolonged decline in demand and excess capacity can require restructuring measures or site closures.
The latest deliberations come as Germany’s auto industry faces weaker demand in Europe, U.S. import tariffs and stronger competition from Chinese manufacturers. AlixPartners said non-Chinese automakers’ share of China’s market fell to 32% in 2025 from 57% in 2020. A VDA survey of 116 German automotive suppliers published in June showed nearly one-third expect business conditions to deteriorate over the next year, more than half are cutting jobs in Germany, only 3% are hiring domestically, and around two-thirds said investments planned for Germany would be postponed, moved abroad or canceled.