Volkswagen Is Cutting Back On Production By An Additional Million Cars

Volkswagen CEO Oliver Blume announced today the reduction of production capacity by another million vehicles, as he stated that earlier sales plans had become unrealistic in the current market conditions.

The company has already reduced capacity in China by one million cars per year, while in Europe, primarily in the Volkswagen and Audi brands, additional reductions should be implemented by 2028.

“In this way, we will go from an investment capacity of over 12 million to a sustainable nine million vehicles per year,” explained Blume in an interview with the German Manager Magazine. He reminds that since the coronavirus pandemic, around nine million cars have been sold globally per year, while in 2019 that figure was 11 million.

Blume emphasized that Volkswagen is making “progress in reducing factory costs that has not been seen before in the company”, but that excess capacity is still a huge financial burden.

This strategy follows the already agreed-upon austerity measures at Volkswagen. At the end of 2024, management has agreed with the works council to cut 35,000 jobs in Germany, according to Handelsblatt. At the level of the entire concern, which also includes brands such as Porsche and Audi, a total of 50,000 jobs are planned to be cut by 2030.

• Also See: Volkswagen’s Sales In Important Markets Are Still Low.