Volkswagen at a Crossroads: Porsche SE Demands Action as 100,000 Jobs Hang in the Balance

Oliver Blume's Drastic Restructuring Plan

CEO Oliver Blume has proposed what he called "the most comprehensive realignment in the company's history." In a July 13 staff memo, Blume outlined plans to cut up to 50,000 additional jobs beyond the roughly 50,000 reductions already underway from a 2024 cost-savings program. Combined, this would bring total potential job cuts to up to 100,000, about 16% of Volkswagen's global workforce.

The plan also included the closure of four German plants: Hanover, Zwickau, Emden, and Audi's Neckarsulm plant, which alone would eliminate over 45,000 jobs. Volkswagen would also slash its model lineup by up to half and significantly reduce production capacity. Blume cited a ~20% cost disadvantage versus rivals as the core reason for the drastic measures.

Supervisory Board Rebellion

Blume's plan met immediate and fierce resistance. On July 9, 2026, the Volkswagen supervisory board voted 12 to 19 against the restructuring proposal that included the plant closures and 100,000 job cuts. Labor representatives sharply criticized Blume after details leaked, and workers staged protests against what they called "unfair competition" and the threat to German jobs. The state of Lower Saxony, which holds a 20% voting stake that can block key decisions, also pushed back against plant closures.

Despite the board's rejection, Blume pressed ahead with the 50,000 additional job cut target and continued efforts to win over workers in subsequent meetings.

Demand-Side Bright Spots

Amid the turmoil, Volkswagen reported several genuinely positive demand signals in its H1 2026 results. The European order book grew to ~1.1 million vehicles at the end of June 2026, providing visibility of more than three months of sales. S Order intake rose 4% year-on-year to 2.1 million vehicles in the first half. S Most notably, battery-electric vehicle (BEV) orders surged 57% to 330,000 vehicles, with BEVs now representing 31% of the European order book, up from 19% a year earlier. S The European order bank was up about 12% compared to year-end 2025. S Revenue remained relatively stable, and VW confirmed its full-year operating margin target of 4.0–5.5%, expecting improvement in the second half. S

So while the cost structure, excess capacity, and governance deadlock are pulling VW into crisis, the company's order book — especially for EVs — is genuinely strengthening, giving it a demand-side footing to work from if the internal restructuring battles can be resolved.