New Delhi: Volkswagen has announced plans to cut around 50,000 jobs in Germany by 2030 as the company deals with a sharp fall in profits and rising challenges in the global car market. The job reductions will affect different parts of the group, including its premium brands Audi and Porsche.
The company’s profits dropped significantly in 2025, reaching their lowest level since 2016. According to the firm’s annual report, post-tax profits fell by around 44%. The company said several factors affected its performance, including import tariffs in the United States, strong competition from Chinese carmakers and the high cost of shifting towards electric vehicles.
Job cuts planned across the group
Chief executive Oliver Blume confirmed the scale of the workforce reduction in a letter to shareholders. He said the cuts would take place in Germany and cover different divisions of the Volkswagen Group.
“In total, around 50,000 jobs are due to be cut by 2030 across the Volkswagen Group in Germany,” Blume said in a letter to shareholders in the firm’s annual report.
The company has already reached an agreement with labour unions to reduce more than 35,000 jobs in the country by 2030. Volkswagen said the reductions would be carried out in a “socially responsible manner”. The move is part of a wider effort by the company to save around €15bn.
Profit pressure and global competition
Volkswagen said the decline in profits was also linked to weakening demand in China. The German carmaker had earlier benefited greatly from the Chinese market, but sales there have slowed in recent years.
At the same time, Chinese car brands have started expanding in Europe, increasing competition for established manufacturers such as Volkswagen. Another challenge came from trade policy changes in the United States after US President Donald Trump introduced 25% tariffs on imported cars.
According to the company’s annual results, net profit after tax fell from €12.4bn to €6.9bn last year.
Finance chief Arno Antlitz said the company’s profit margin remains too low for the long term. Volkswagen expects a core profit margin of between 4% and 5.5% in 2026, which could still be below the 4.6% margin recorded this year.
“We can only realise this if we continue to rigorously reduce costs,” he said. “That is what we will focus on in the coming months.”