Volkswagen Group’s downsizing plans could soon reach its management structure after a long phase in which the heaviest measures mainly affected factories and production staff. According to reports from Germany, the automaker is considering eliminating around 5,500 management positions worldwide, reducing the total from the current 21,500 to approximately 16,000.
Volkswagen takes cost cuts to the top as 5,500 management roles face elimination
The proposed changes would form part of the restructuring program Volkswagen launched to cut costs and speed up decision-making across a group that includes numerous brands and companies. Volkswagen, Audi, Porsche, and Cariad have already planned around 50,000 departures combined, while CEO Oliver Blume has raised the theoretical possibility of another 50,000 job cuts worldwide.
The group is also reviewing the future of its Emden, Hanover, Zwickau, and Neckarsulm plants, where it has yet to identify competitive industrial programs beyond 2030. Blume has nevertheless said he would prefer alternatives to closing the facilities.
The new management structure would reportedly consist of four levels and replace a system Volkswagen considers overly complex. The first two levels, responsible for strategic decisions, would include no more than 400 and 1,200 people respectively. A third tier of 3,600 managers and a fourth tier of 10,800 would oversee operational activities. The plan could also allow managers to move to a lower tier, preventing every organizational change from automatically leading to dismissal.
Volkswagen is reportedly preparing to revise variable compensation from 2027 as well. Individual performance would account for 35% of each bonus, compared with the current share of between 13% and 17%. The component linked to long-term results would fall from 50% or 60% to a maximum of 40%. The assessment would consider whether managers achieved their targets, how they behaved, and the impact they made within the company.
The group is also reviewing operations it considers less important to its core automotive business, including certain investments and sports sponsorships. Reports suggest Volkswagen holds full or partial interests in more than 2,000 companies, around 35% of which could face consolidation, sale, or closure.
Simplifying the portfolio could generate between €10 billion and €15 billion in additional liquidity by 2030, although this target also depends on a plan that has not yet received full approval.
Volkswagen has not officially confirmed the elimination of 5,500 management positions, the new four-tier structure, or the changes to executive bonuses. The figures and timetable could therefore change during negotiations with the supervisory board and employee representatives. Even so, the restructuring increasingly appears likely to reach the highest levels of the group.
