Volkswagen is preparing for a deeper restructuring effort as the German auto giant faces growing pressure to close a widening cost gap with global competitors, CEO Oliver Blume told employees in an internal memo.
The company’s latest analysis found that Volkswagen’s costs are around 20% higher than those of comparable automakers, prompting management to review operations across brands, regions and business units.
While additional workforce reductions are being considered, Blume stressed that the company is still assessing where adjustments are necessary and achievable. The potential impact could extend beyond previous restructuring plans as Volkswagen attempts to strengthen its position in an increasingly competitive automotive market.
The company has already agreed to reduce around 50,000 jobs across the group, including positions at its premium brands Porsche AG and Audi AG.
According to Blume, internal calculations suggest that Volkswagen would theoretically need to eliminate another 50,000 positions worldwide to fully match the cost structures of rival companies.
The warning comes as traditional carmakers face mounting challenges from rising production expenses, the shift toward electric vehicles and stronger competition from manufacturers with lower operating costs.
Volkswagen is now reviewing its global footprint and production structure as it seeks to improve profitability while continuing investment in future technologies.
“Theoretical calculations do not represent final decisions,” Blume said, adding that the company is evaluating what changes are “actually necessary and feasible.”
The restructuring debate highlights a broader challenge for Europe’s automotive industry: balancing cost reduction with the need to invest heavily in electric mobility, software and new manufacturing technologies.