Volkswagen AG has finalized the ‘Zukunft Volkswagen’ agreement, a comprehensive strategy to strengthen its competitiveness and position itself as the technological leader among global volume manufacturers by 2030.
The deal, reached with employee representatives after extensive negotiations, focuses on aligning production, reducing costs, and fostering innovation.
Key measures include reducing production capacity at German plants by 734,000 units and cutting the workforce by over 35,000 in a socially responsible manner, supported by a job security plan through 2030.
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These changes are expected to yield annual savings exceeding €15 billion, with €1.5 billion from labor cost reductions alone.
Volkswagen Passenger Cars, the company’s core brand, aims to achieve its medium-term return-on-sales target and maintain a competitive edge. CEO Oliver Blume emphasized the agreement as a decisive step for long-term success, with plans to refocus production and leverage new technologies.
German production sites will undergo realignment to enhance efficiency and competitiveness. Highlights include Wolfsburg focusing on electric vehicle production, the ID.3 and CUPRA Born, while relocating Golf production to Mexico. Other plants, such as Emden, Zwickau, and Dresden, will see adjustments to streamline operations.
Volkswagen Commercial Vehicles and Group Components divisions will also implement measures to reduce costs and invest in future products, including advancements in circular economy initiatives.
This transformative plan underlines Volkswagen’s commitment to sustainable mobility and operational excellence, ensuring its position as an industry leader while safeguarding jobs and investments in Germany.
Source: Volkswagen AG Secures Strategic Agreement to Strengthen Future Competitiveness
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