German automaker Volkswagen (VOW3) has announced plans to eliminate 50,000 jobs as it grapples with U.S. tariffs and rising competition from Chinese vehicles.
Volkswagen, which is Europe’s largest automaker, announced the job cuts as part of its “Future Plan 2030” restructuring strategy.
The plan is made up of 12 initiatives that would result in the “most strategically profound transformation program” in the company’s 89-year history.
The centrepiece of the transformation is 50,000 job cuts, including management positions. Volkswagen said the cuts are needed as it struggles with rising competition and tariff costs.
The latest workforce reduction is in addition to 50,000 job cuts that were previously announced, bringing the total staff rationalization to 100,000 positions.
Going forward, Volkswagen said that it plans to streamline its leadership structure and adopt a flat hierarchy.
The company also plans to reduce the number of vehicles it makes by 50% over the next 10 years, with a smaller product line-up among its cars, SUVs, and gas-electric hybrid models.
Volkswagen has struggled with falling profits over the past year as tariff pressures mount. The company reported tariff expenses of $3.4 billion U.S. for all of 2025.
Two years ago, the automaker was paying 2.5% in tariffs on its vehicles sold from Europe, but that has since jumped to 15%.
At the same time, Volkswagen faces growing competition from Chinese vehicles that are entering the European market and gaining ground with electric vehicle sales.
The restructuring at Volkswagen has not proved popular in Germany, where the company’s union has vowed to fight the changes and politicians have criticized the cuts.
Still, Volkswagen’s stock is up 6% on Sept. 4 following news of the latest plans aimed at shrinking its operations.
VOW3 stock has declined 60% over the last five years to trade at 80.92 Euros per share.
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