Volkswagen has announced plans to reduce its workforce in Germany by 50,000 jobs by 2030 following a sharp decline in profits to their lowest level since 2016.

Chief Executive Oliver Blume told shareholders that the job cuts will affect the entire Volkswagen Group, including its brands Audi and Porsche.

Europe’s largest carmaker reported a 44% drop in post-tax profits in 2025, citing factors such as US import tariffs, growing competition from Chinese automakers, and high restructuring costs associated with the shift to electric vehicles.

Blume, in a letter to shareholders included in Volkswagen’s annual report, said:
"In total, around 50,000 jobs are due to be cut by 2030 across the Volkswagen Group in Germany. We are operating in a fundamentally different environment."

The company had previously agreed with unions to cut more than 35,000 jobs by 2030 in a socially responsible manner, aiming to save around €15 billion (£12.4bn).

Volkswagen, along with other German carmakers, has been severely affected by declining demand in China, which had previously been a key market. At the same time, Chinese brands are increasingly entering the European market, intensifying competition.

US import tariffs of 25% on cars, introduced under former President Donald Trump, have further strained the company’s sales.

In its annual financial report, Volkswagen revealed that net profit after tax fell from €12.4bn (£10.7bn; $14.4bn) to €6.9bn (£6.1bn; $8bn) in 2025.

Looking ahead to 2026, the group expects a core profit margin of 4–5.5%, potentially lower than the 4.6% margin achieved in 2025.

Finance Chief Arno Antlitz warned that the current profit margin is unsustainable and emphasized the need for further cost reductions.

"We can only realise this if we continue to rigorously reduce costs. That is what we will focus on in the coming months," he said, underlining the company’s commitment to stringent efficiency measures amid a challenging global automotive market.