The Volkswagen Group, which encompasses brands such as Audi, Bugatti, Seat, Skoda, and Porsche, is embarking on a comprehensive restructuring process in Germany. The group announced that the total impact of its cost-cutting programs will result in the loss of approximately 50 jobs, with the goal of completing this process by 2030.
CEO Oliver Blume stated during the announcement of the 2025 fiscal year financial results that the job cuts plan would cover all brands in Germany. Specifically, Audi is expected to eliminate 7,500 positions by 2029, while Porsche will see the elimination of 3,900 positions, including temporary workers. Cuts will also occur in the Cariad software unit. While the number of employees in Germany is estimated to be around 293,000 at the end of 2024, the full implementation of the plan could reduce this figure to approximately 250,000. New hires are expected to be limited.
The layoffs are expected to be most intense at the main brand, and as part of an agreement with the unions at the end of 2024, it was decided to reduce 35 positions in Germany by 2030. However, the savings targets are not limited to the main brand; other brands within the group also face similar cost-cutting targets.
Sharp decline in profitability.
The group's financial results clearly demonstrate why it has embarked on a comprehensive cost-saving program. In fiscal year 2025, the group generated sales revenue of €321,9 billion, a decrease of only 0,8% compared to the previous year. However, profitability experienced a significant decline: operating profit fell to approximately €8,9 billion, and net profit dropped to €6,7 billion, representing a decrease of nearly 38%. Consequently, the operating profit margin fell to 2,8%, one of the lowest levels recorded since the Dieselgate impact in 2016. According to Blume, the transformation program will encompass all business areas and will require cost-cutting measures in various departments, including R&D, procurement, sales, quality management, and production. Furthermore, the goal is to simplify the organizational structure, consolidating some critical functions under a more centralized structure.
