Amid reports of plans to eliminate up to 100,000 jobs and close four factories in Germany in the medium term, Volkswagen is terminating its partnership with Bosch for the development of autonomous driving systems. The impact is already being felt on the stock market, with VW shares recording losses of 1.7%. According to a report by BILD, despite an investment of €1.5 billion, Volkswagen has cancelled one of its most significant future projects — the Automated Driving Alliance with Bosch — which had originally been seen as the German automotive industry’s counter-offensive against Tesla and Chinese manufacturers. Since 2022, more than 1,000 specialists were set to collaborate with Cariad, VW’s software subsidiary, but in recent years the project has been plagued by delays and continuous revisions.
Volkswagen CEO Oliver Blume plans radical restructuring of the Group’s operations
The newspaper further reports that Volkswagen plans to purchase and further develop hardware and software for future Level 2++ systems with a new partner, rather than developing them in-house with Bosch. The new partner is currently in the selection process, with the cooperation agreement expected to be finalized in September. As reported over the weekend by Manager Magazine, Volkswagen CEO Oliver Blume is planning a radical restructuring of the Group’s operations aimed at reducing costs. According to the magazine, the plan calls for the elimination of up to 100,000 jobs, representing 15% of the company’s global workforce. In addition, the medium-term closure of four major factories in Germany is being planned: in Hanover, Zwickau, Emden, and Neckarsulm, where an Audi production line operates. These factories currently employ 40,000 people, with a combined production capacity of 750,000 vehicles per year. The potential factory closures are in any case planned to take place only after current model production ends, which will not happen before 2030.
Manager Magazine also reports that Oliver Blume has already presented his plan to the management board, while the supervisory board is set to discuss it on July 9. The Group’s works council has already responded to the leaked information: “The latest media reports are rightfully unsettling our workforce and our production facilities. However, attacks on the VW law protecting against layoffs, the requirement for co-determination, and our factories are irresponsible threats. Should such plans be implemented, we will do everything in our power to prevent them,” its representatives stated, calling on company leadership to “stop engaging in blind activism, finally do its job, and focus on its core responsibilities: competitive products, technologies, corporate structures, and synergies — and in doing so, secure employment.”
Oliver Blume’s plan also includes a reduction in general expenses of €11 billion by 2030, while up to 5,500 managers out of a total of 20,000 could find themselves out of work. Overall, the new plans double the job cuts from the 50,000 that the Group had agreed upon with workers in 2024. Indicative of the radical nature of the planned restructuring is the possibility that the Group’s core company, Volkswagen, could be spun off from the current corporate structure — a move that, as the magazine notes, would undermine existing worker protection mechanisms. The turmoil surrounding the Group is today causing significant losses in VW’s preferred shares. In XETRA trading, the stock fell 1.7% to €73.00.
