Volkswagen’s Board Delivers Stinging Rebuke to CEO Blume, Voting Down Radical Restructuring Plan
Published on 07/12/2026 at 17:45 | Redaktion boerse-global.de
Volkswagen’s supervisory board has flatly rejected chief executive Oliver Blume’s ambitious restructuring blueprint, dealing a heavy blow to the man who had promised the most comprehensive overhaul in the company’s 87-year history. Twelve of the 19 board members voted against the plan, with only seven in favour, underscoring the deep rift between management, labour representatives and the state of Lower Saxony.
The vote blocked the closure of four German plants — Emden, Hannover, Neckarsulm and Zwickau — as well as the elimination of up to 120,000 jobs worldwide. That figure combines the 50,000 positions already slated for cuts with a further 70,000 that Blume wanted to shed by 2030. The board’s rejection leaves those sweeping headcount reductions in limbo, though the CEO can still push ahead with other measures, such as slashing the model line-up from roughly 140 vehicles to 73, without further approval.
Blume had warned the company was facing an existential threat, and his management team is now weighing an extraordinary general meeting — a rarely used legal option that allows the board to bypass the supervisory board when a company’s survival is at stake. The move would escalate the already bitter conflict between management, the works council and the government of Lower Saxony, which is Volkswagen’s second-largest shareholder after the Porsche/Piëch family.
Labour representatives and the state government, which together control half the supervisory board seats, have argued that plant closures are not a viable strategy. Lower Saxony’s premier, Olaf Lies, reiterated that position after the vote, saying such measures offered no future for the company’s workforce. More than 54,000 orders have already been placed for the new electric Urban Car Family models — the VW ID. Polo, Škoda Epiq and CUPRA Raval — and the group remains Europe’s leading seller of battery-electric vehicles, with 377,000 units delivered in the first half of this year.
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Still, the operational headwinds are mounting. Global deliveries slid 8.6 percent in the second quarter, the steepest quarterly drop in four years, as demand in China — VW’s largest single market — continued to deteriorate. The premium Audi brand also suffered, with first-half deliveries down 7 percent, squeezed by Chinese competition and US tariffs. Blume has argued that only radical cost-cutting can make the group resilient enough to weather a “massively challenging global environment,” a view the board majority has now explicitly rejected.
The market has taken fright at the standoff. Volkswagen’s preferred shares closed at €71.06 on Friday, within striking distance of the 52-week low of €69.20 hit in early July. The stock has surrendered 33 percent since the start of the year and sits almost 35 percent below its December 2025 high of €109.10. The 200-day moving average of €93.78 now looms more than 24 percent above the current price, a chasm that reinforces the bearish technical picture.
The relative strength index has fallen to 30.2, a level that typically signals an oversold condition, but the turbulence is unlikely to subside soon. The 30-day annualised volatility stands at 32.2 percent, meaning the share price is prone to outsized swings with every fresh twist in the boardroom drama. On a monthly basis, the stock has already tumbled 17.85 percent.
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Blume now faces the difficult task of forging a compromise before the summer break ends. The works council has demanded clarity from management on the restructuring proposals, warning of company-wide meetings after the pause if no clear direction is provided. Whether a revised version of the Zukunftsplan can win over the necessary majority on the supervisory board remains an open question — one that will determine both the CEO’s survival and the future direction of Europe’s largest automaker.
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