Volkswagen to Cut 50,000 Jobs Amid Profit Decline and Tariff Impact
Volkswagen announces plans to reduce its workforce by 50,000 by 2030 following a significant drop in profits attributed to US tariffs and market challenges.
Volkswagen has announced plans to reduce its workforce by 50,000 by 2030, citing a significant decline in profits due to US tariffs and market challenges. The German automaker reported a 44% drop in profits for 2025, falling from €12.4 billion to €6.9 billion. Revenue decreased by 0.8% to €322 billion, with global vehicle sales down 0.5% to 8.98 million units.
The company attributed the profit decline to the impact of US tariffs, increased competition from Chinese manufacturers, and challenges within its Porsche subsidiary, which saw operating profit plummet by 98% to €90 million. In response, Volkswagen plans to implement a 20% cost reduction across all brands by 2028, aiming to save approximately €60 billion.
CEO Oliver Blume stated that the job cuts are part of a restructuring plan to address the challenging market environment. The company had previously agreed with German trade unions to cut 35,000 jobs by 2030 through natural attrition and voluntary departures. As of June 2025, around 20,000 employees had accepted voluntary redundancy offers.
Volkswagen also warned that geopolitical tensions, including the US-Israeli military action against Iran, could negatively affect demand for its premium brands, Audi and Porsche. Blume noted the volatility and fragility of the current global environment, emphasizing the need for the company to adapt to ongoing challenges.