Volkswagen Group is weighing the closure of up to four German plants, a move that could slash its German workforce by 15 percent. The idea follows a disastrous 2025, when sales stalled and profit fell 44 percent to 6.9 billion euros. With operating margins halved, the automaker faces pressure to cut costs while preserving quality. The proposal underscores the scale of VW's turnaround challenge amid a shifting market.

2025 also saw VW excel in European EV sales, yet demand in North America and China slipped sharply, compounded by tariffs. CFO and COO Arno Arnitz warned investors that the current margin was “far too low” and called for a fundamental business‑model overhaul, targeting reduced product complexity and fewer decision‑making layers. The slowdown also pressures VW’s electrification timeline, forcing a rethink of its multi‑platform strategy.

Analysts see plant closures as a blunt tool to trim excess capacity and improve profitability. If VW follows through, the cuts could double the previously announced 50,000‑job reduction plan, reshaping its manufacturing footprint across Europe. The board vote will set the pace for cost cuts across the group.