At Volkswagen, a 12-7 Board Vote Sets the Stage for a Bitter Restructuring Battle as Job Cuts Mount
Published on 07/16/2026 at 06:06 | Redaktion boerse-global.de
Volkswagen’s supervisory board threw a wrench into CEO Oliver Blume’s cost-cutting plans on July 9, voting 12 to 7 against his “Zukunftsplan”—a twelve-point blueprint aimed at restoring competitiveness by 2030. But rather than retreat, Blume doubled down. An internal memo dated July 13, reviewed by Reuters, warns that up to 100,000 jobs could be eliminated worldwide, including 50,000 additional positions beyond the cuts already agreed for Germany. The memo cites a 20 percent overhead cost disadvantage versus rivals, equivalent to €11 billion, as the driving factor. The board’s rejection came less than a month after the annual general meeting on June 18, where the company had already flagged plans to slash annual production capacity from 12 million to 9 million vehicles.
The conflict now pits management against powerful labor representatives and the state of Lower Saxony, a major shareholder. Blume has publicly favored “intelligent solutions” over outright plant closures, exploring options such as manufacturing Chinese partner models at underutilized German sites in Emden and Zwickau. Yet the memo casts doubt on the long-term viability of four domestic plants—Emden, Hanover, Zwickau, and Neckarsulm—saying no competitive usage scenarios have been confirmed for the 2030s. Media reports suggest production could end at Zwickau and Emden as early as 2031, with Hanover following in 2032 and the Audi plant in Neckarsulm in 2034. Nothing is final, but the timeline underscores the urgency of the restructuring.
The operational numbers justify the alarm. Worldwide deliveries in the second quarter of 2026 fell 8.6 percent to 2.08 million vehicles, with the critical Chinese market plunging 36.6 percent to 424,300 units. The core brand group posted a 5.9 percent decline in first-half sales to 3.115 million vehicles, while Porsche’s second-quarter deliveries dropped 18 percent to 61,300. Skoda was a rare bright spot, with a 4.9 percent increase to 284,000 vehicles. Management highlighted both the China slump and margin pressure from electric-vehicle price wars during a July 13 analyst call. On a positive note, the European order book for battery-electric vehicles stood more than 50 percent higher than at the end of 2025, with almost a third of open orders now for pure EVs.
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Meanwhile, the company is pushing ahead with its $5.8 billion joint venture with Rivian. On July 13, the shared software entity, RV Tech, selected Flow Engineering’s platform to power the next generation of vehicle architectures. An internal rescue plan also proposes slashing investment and R&D budgets by €50 billion from 2027 to 2031, bringing the total to €135 billion—a stark illustration of the depth of the cost problem.
The stock market has responded with caution. Volkswagen’s preferred shares closed Wednesday at €74.38, up 3.62 percent from the previous session and 3.31 percent higher than a week ago. That modest bounce does little to mask the longer-term damage: the shares have lost 29.90 percent since the start of the year, and depending on the calculation method, the 30-day decline ranges from 15.86 percent to 17.67 percent. The close sits 31.82 percent below the 52-week high of €109.10 reached last December, but 7.49 percent above the recent low of €69.20 touched on July 1. The stock remains below all major moving averages—the 50-day at €83.31, the 100-day at €86.74, and the 200-day at €93.51—while the relative strength index of 42 signals neither oversold nor overbought conditions. Analysts see limited upside: Wallstreetonline’s median price target of €74.97 barely exceeds the current level, and Bernstein Research reiterated a “market-perform” rating in late June.
The next flashpoint comes in September, when the supervisory board is due to meet again. Blume must present an “Etappenstrategie”—a phased plan to push through cost cuts even against worker opposition. Before that, Volkswagen will release its half-year financial report on July 24, offering a clearer picture of how the delivery slide and EV price war have hit margins. For now, the standoff between the boardroom and the factory floor leaves one of Europe’s largest industrial restructurings hanging in the balance.
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