Volkswagen's restructuring plan, approved by its supervisory board this month, includes up to 50,000 job cuts and potential factory closures, yet the carmaker was ejected from the Euro Stoxx 50 index following a profit warning. Chief executive Oliver Blume aims to reduce the workforce from 647,000 by over 100,000 and lower annual volume targets from 12 million to 9mn vehicles, driven by a 20 per cent slump in the Chinese market and US tariffs under President Donald Trump. Chief financial officer Arno Antlitz acknowledged the China trend is inescapable.

VW's governance — split among workers, unions, local politicians, and the Piëch and Porsche families — remains a structural hurdle. The state of Lower Saxony, VW's second-largest shareholder, holds a blocking minority under a special law. Management secured unanimous board approval only after threatening a legal workaround to bypass worker and state opposition.

A former executive described VW's factories as the most inefficient ever seen. Investors remain sceptical: "Time and again, some part of VW decides to defeat itself." The truce between factions is fragile, and the plan's execution faces significant uncertainty.