Volkswagen CEO Oliver Blume made this statement while speaking at the company’s annual shareholders’ meeting, according to Investing.com.
According to him, the situation for the automaker remains “tense and challenging,” and operating conditions in the industry in 2026 turned out to be even tougher than previously expected. “Our business model, which has been successful for decades, no longer works today. We must develop it differently,” Blume said.
The CEO emphasized that Volkswagen intends to become “the world’s most attractive automaker” by the end of the decade and achieve a sales profit margin of 8% to 10%.
The company is cutting costs and reducing capacity in China
At the heart of the strategy is accelerating the transition to electric vehicles and enhancing the brand’s competitiveness. According to Blume, new models, including the recently unveiled electric ID. Polo, demonstrate that Volkswagen “is once again at the forefront of the competition.” However, the current profitability of new products remains insufficient.
The most extensive cuts will affect the core Volkswagen brand. By 2030, the company intends to eliminate 35,000 jobs. By the end of 2026, the workforce is expected to be reduced by 19,000 people. According to Blume, approximately 28,000 voluntary resignations have already been agreed upon with employees.
At the same time, the company continues to reduce production costs. According to management, expenses at Volkswagen’s German plants fell by more than 20% in 2025.
The company also plans to reduce production capacity in Europe and China. By 2030, Volkswagen plans to further reduce production at its European plants by 500,000 vehicles, in addition to the previously announced reduction of 1 million vehicles by 2028. A similar reduction in capacity is planned for the Chinese market.
