Volkswagen’s Net Profit Plunges 28% as Qatar Blocks Restructuring and 100,000 Jobs Hang in Balance
Published on 07/14/2026 at 12:32 | Redaktion boerse-global.de
Volkswagen’s net income tumbled 28% in the first quarter of 2026 to €1.56 billion, deepening the pressure on a company already paralyzed by internal boardroom strife. Revenue slipped 2% to €75.7 billion, and the carmaker now faces an additional €4 billion to €5 billion annual hit from US import levies on vehicles and parts.
Against that grim backdrop, the boardroom feud over how to slash costs has escalated into open political warfare. Chief executive Oliver Blume first revealed the scale of the cuts in an internal interview posted on the company intranet, warning that an extra 50,000 jobs could be eliminated on top of the roughly 50,000 already agreed. That would bring total potential cuts to around 100,000 positions — about 15% of the global workforce — with the majority in Germany.
Blume justified the move by pointing to a 20% cost disadvantage versus key competitors, arguing that because half of the group’s overheads come from personnel expenses, the math leads inexorably to 50,000 additional job removals. The CEO also wants to pare global production capacity from 10 million to 9 million vehicles a year and halve the model lineup over the medium term.
Yet the supervisory board blocked the plan’s core element: the closure of four German plants in Hanover, Zwickau, Emden and Neckarsulm. A formal motion on the shutdowns was defeated 12 votes to 7, with labor representatives and the state of Lower Saxony opposing. Works council chief Daniela Cavallo described the situation as a “massive loss of trust.”
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Now a second roadblock has emerged. According to a report in Der Spiegel, Qatar — one of VW’s largest shareholders with two seats on the board — is also holding up progress on a separate restructuring master plan. The delay is said to stem not from cost concerns but from the emirate’s strained relations with Israel, dragging the automaker’s internal row onto a diplomatic battlefield that Blume can barely control.
The impasse has worsened conditions for more than 40,000 employees at five German sites — Emden, Hanover, Neckarsulm, Osnabrück and Zwickau — who still have no product commitments for the 2030s. The works council called the uncertainty “unbearable” for workers, suppliers and the affected regions.
While the boardroom drama drags on, Volkswagen’s share price continues to reflect deep investor unease. On Tuesday, the preferred stock traded at €71.70, up 0.48% on the day but still down roughly 32% since the start of the year. That places it just 3.6% above the recent 52-week low of €69.20 touched on July 1. The relative strength index stands at 32.6, suggesting a near-oversold condition, while the annualised 30-day volatility has settled at 32.40%.
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JPMorgan reiterated its “neutral” rating on the stock with a €110 price target on July 13, pointing to stable sales of electric and hybrid vehicles and a 12% increase in the order book since the start of the year.
Despite the mounting challenges, management has held its full-year guidance calling for revenue growth of 0% to 3% over the 2025 base of €321.9 billion. Whether that forecast survives the twin blows of Katar’s political blockade and a potential tariff shock will depend on how quickly Blume can piece together a compromise — both in the boardroom and on the factory floor.
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