The paradox at the heart of Volkswagen’s current crisis could hardly be starker. As the supervisory board prepares to convene on September 4 to weigh factory closures and a fresh round of job cuts, the company’s main plant in Wolfsburg is simultaneously ramping up extra shifts for combustion-engine models. Sixteen assembly shifts plus special shifts in body construction and paintwork are being scheduled to meet persistent demand for petrol and diesel vehicles — a short-term operational reality that sits awkwardly alongside the long-term capacity reduction plan awaiting board approval.
The numbers explain the tension. In the first quarter of 2026, combustion engines accounted for 30.3 percent of new registrations in the EU, while pure battery-electric vehicles captured just 19.4 percent. The market may be transitioning, but it is not transitioning fast enough to justify the scale of the planned cuts — and that disconnect is set to complicate an already fraught boardroom discussion.
A Board Split Down the Middle
The vote on September 4 will determine whether management’s restructuring blueprint or a labour-backed counterproposal becomes the foundation for the group’s overhaul. The stakes are considerable: the works council is demanding clarity on whether an additional 50,000 jobs beyond the 50,000 already slated for elimination by 2030 are at risk. Management, for its part, has been preparing talks with regional representatives in Hannover, Osnabrück, Emden, and Zwickau, with works meetings having been scheduled for late August.
The boardroom itself is deeply divided. A restructuring package put forward in July failed to secure approval, with 12 votes against 7 — a clear indication that the labour side is not prepared to follow the executive board unconditionally. Porsche SE, which holds 53.3 percent of voting rights as the largest shareholder, is pushing for a faster pace of change, while the employee side has submitted its own alternative proposal that would avoid radical cuts.
Political Pressure and Management Under the Knife
External pressure is mounting. Lower Saxony’s minister-president has urged a swift resolution ahead of the board meeting, and the state’s traditional weight in the supervisory board is expected to play a pivotal role in the outcome. The political dimension adds another layer of complexity to what is already a high-stakes negotiation.
Notably, the cost-cutting drive is no longer aimed solely at the factory floor. The group is examining reductions in management ranks as well, with observers interpreting this as a signal that austerity measures will now extend to higher hierarchical levels. At sites like Emden and Zwickau, cost pressure is intensifying, and the message from the top appears to be that no layer of the organisation is exempt.
CEO Oliver Blume has been candid with the workforce, acknowledging that the savings and cost-reduction programme is “not over yet” — a comment that has done little to soothe nerves among employees already frustrated with the management’s communication style. Workers at the Kassel plant formally demanded concrete commitments during ongoing restructuring talks on Friday, and a series of works meetings across multiple sites has accompanied the continued austerity push.
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The Labour Pledge Under Threat
The deepest anxiety centres on whether earlier commitments from the IG Metall collective agreement — no factory closures and no compulsory redundancies until the end of 2030 — will be honoured. The labour side fears these assurances could be diluted as the pressure for faster restructuring intensifies.
Meanwhile, the product pipeline continues regardless of the internal turmoil. The fourth quarter will see the launch of the Golf Hybrid and T-Roc Hybrid in Europe, followed by the ID.3 GTI electric hot-hatch in September. In a separate development, Volkswagen has selected Continental as the tyre supplier for the new ID. Polo — a decision that is peripheral to the crisis but relevant to the company’s model strategy.
Personnel changes are also accompanying the transformation. Nicole Kösling takes over as head of human resources at Volkswagen Group of America on September 1, while Ingrid Rieken, previously HR chief at the divested Everllence subsidiary, has been responsible for vehicle production HR in Wolfsburg since August. Thomas Edig, the long-serving HR executive in Saxony who previously held the same role at Volkswagen Nutzfahrzeuge, has been retired.
The Market’s Verdict
The share price tells a different story from the mood on the factory floor. The stock closed Monday at €77.20, up 5.5 percent over the week — a performance suggesting investors view the hard line on restructuring as a necessary step rather than a cause for alarm. The shares now trade roughly 12 percent above their 52-week low of €69.20, set in early July, though they remain about 29 percent below the 52-week high of €109.10.
That gap to the high reflects lingering scepticism about the pace of the turnaround. But the recent resilience suggests the market is willing to give management credit for holding its course — even as the workforce pushes back against both the substance and the communication of the cuts.
The September 4 board meeting will determine whether Blume’s uncompromising approach prevails or whether political pressure from Lower Saxony and employee discontent force a softened version of the savings programme. The next quarterly results, due October 29, should reveal whether the board’s decisions are already showing up in the numbers. For now, the contradiction remains unresolved: a company running extra shifts to meet demand for the very vehicles it is planning to phase out, while preparing to shed tens of thousands of jobs in the name of transformation.
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