Pace of Volkswagen job cuts slows as fewer staff agree to leave
Decrease in take-up of early retirement and voluntary redundancy programmes since June
Volkswagen has suffered a dramatic slowdown in the number of workers agreeing to quit their jobs at its German sites as the carmaker attempts a sweeping cost-cutting plan.
The ailing group is trying to reduce employee numbers at VW brand sites in the country by 35,000 by 2030 compared with levels at the start of 2024.
But it remains 10,000 short of that goal as the number of staff accepting redundancy or early retirement plummeted in the three months to September, according to an internal memo seen by the Financial Times.
Of the 25,000 staff who have reached exit agreements since the start of 2024, just 1,000 did so in the third quarter of this year, according to a note shared with workers which was seen by the Financial Times and confirmed by a person close to the company.
Voluntary exits in the 18 months to June 2025 averaged 4,000 every three months but the memo did not give a breakdown of the number of planned departures per quarter during that period.
The 35,000 target was set as part of a cost-cutting programme agreed with unions last December and represents roughly a quarter of the brand’s headcount as of the start of 2024.
Trimming headcount further will be “increasingly difficult”, according to Stefan Bratzel, director of the Center of Automotive Management, an independent German research institute.
But he said VW’s savings programme was on a “good path”, with the group needing to be “much leaner and more efficient” to survive the sector’s upheaval.
Volkswagen declined to comment on the exact rate of progress in the job reductions. A person familiar with its thinking said the pace at which it could plan new departures had slowed over the summer, when many employees were away on holiday.
The number of volunteers to leave the company could increase once an early retirement scheme was opened to younger employees, the person added.
A job guarantee until 2030 meant “no one is being forced to be part of the reduced headcount”, said a spokesperson for VW’s works council. While VW has until 2030 to meet its target, the structure of its early retirement schemes means some workers sign up years in advance of their exit date.
Thomas Schäfer, chief executive of the VW brand, acknowledged last week that “we still have a way to go” on the job cuts, adding that the carmaker was “consistently implementing” the programme.
The brand’s head of human resources Arne Meiswinkel said last week that VW was making “good progress” with the plan to reduce its headcount.
The slower pace of exit agreements comes as VW wrestles with higher US tariffs and large losses at its luxury sports car marque Porsche.
The cost pressures have left the group with little room to make additional investments.
The group’s chief financial officer Arno Antlitz warned last month that VW needed to “intensify our cost reduction efforts”, with the company facing an estimated €5bn hit from US tariffs in 2025.
Of the 25,000 exit deals struck so far, about 11,000 employees have already left, while another 14,000 have agreed to leave over the coming years. The brand had 115,000 staff in Germany at the end of 2023, according to VW’s most recent quarterly results.
Almost three-quarters of the departures agreed so far have been via an early retirement programme while others have been through voluntary redundancy.
So far, the voluntary redundancy programme has generally only been open to white-collar workers, but now factory-floor workers, who are relatively well paid for the industry and have fewer outside job options, will also be included.
Schäfer said factory costs at three of the carmaker’s largest sites — Wolfsburg, Emden and Zwickau — had been cut by 30 per cent on average as part of the savings programme.