The cost-cutting plan Volkswagen pushed through just before Christmas 2024 is now being put into action. Speaking to German media, Group CEO Oliver Blume has confirmed that the process of eliminating 19,000 positions is already under way, with all affected employees expected to have left the company before the end of 2026.
The scale of the restructuring goes well beyond this year’s deadline. According to Blume, more than 28,000 redundancies have already been formally agreed, and the group is targeting a total reduction of at least 35,000 positions by 2030.
Billions in savings, with more to come
Blume addressed shareholders at a recent Group meeting, noting that the plan has already delivered results. Around one billion euros in sustainable cost savings have been achieved so far, but the ambition stretches considerably further. By 2030, Volkswagen is targeting annual net savings of six billion euros across the Group.
Despite the progress, the Group is not operating in a favourable external environment. US tariffs on imported vehicles are costing Volkswagen at least five billion euros per year, with sister brand Audi bearing the sharpest impact. Unlike some competitors, Audi has no manufacturing presence in the United States, meaning all of its cars are subject to the full 25 percent import duty. Depending on the model, that adds between 800 and 4,700 dollars per vehicle at the border, translating to price increases of up to 30,000 Danish kroner for US consumers.
A broader trade picture
The tariff situation is not entirely without parallel. The European Union itself imposes heavy duties on Chinese electric vehicles: SAIC, the group behind the MG brand in markets including Denmark, faces a 43.5 percent punitive tariff on its exports to Europe.
However, there are indications that Brussels may be willing to ease conditions for American cars specifically. The EU has signalled openness to reducing tariff rates on vehicles imported from the United States, a move that could reshape competitive dynamics across the European market if it materialises.
