Volkswagen CEO urges workforce to back deep cost cuts as crisis looms: meetings at German plants begin Tuesday

Volkswagen CEO Oliver Blume has urged the company’s workforce to unite behind sweeping cost-cutting measures as the automaker confronts what he described as a “mega-crisis” in the global auto industry. “On the next few weeks it depends: everyone must pull together,” Blume told *Bild am Sonntag* on Saturday. “We have set up the largest transformation plan in the history of the Volkswagen Group.”

Blume cited geopolitical tensions, trade barriers, regulatory pressures, weak markets and intense competition as drivers of the crisis, stating that “the Volkswagen Group is right in the middle of it.” He emphasized that the next few years would determine which companies survive and which lead, adding that the current 3.8 percent operating margin is “solid in this challenging environment” but insufficient to fund new technologies, products and sites long term. “We are overdimensioned. That often makes us too slow and too complicated,” he said.

The remarks come ahead of a series of extraordinary works meetings scheduled from Aug. 25 to Aug. 31 at plants including Wolfsburg, Emden, Zwickau, Hannover, Braunschweig, Salzgitter, Dresden, Chemnitz and Kassel-Baunatal. Blume plans to attend the first gatherings in Wolfsburg on Tuesday, followed by Emden and Zwickau on Wednesday. Workers’ representatives had demanded details on cost-cutting plans and job reductions before the summer break.

Blume has previously said the company aims to reduce up to 50,000 positions worldwide to bring overhead costs to a “competitive level.” Reports have singled out the Emden, Hannover, Zwickau and Neckarsulm sites as particularly vulnerable. In an internal interview published on the company intranet and obtained by dpa, Blume reiterated that the situation is “more than critical” and that prior savings—such as a 20 percent average reduction in factory costs at German plants last year—are not enough.

The push for deeper cuts follows Blume’s spring announcement of a new “Target Picture 2030” strategy, with a tightened austerity drive to be finalized this year. The CEO’s warnings echo broader debates about German industrial competitiveness, including recent comments by Saxony’s Minister-President Michael Kretschmer questioning the viability of the 35-hour workweek. Kretschmer told Deutschlandfunk last month that the shorter week “no longer fits the times.”