Volkswagen’s overhead costs exceed those of comparable automakers by more than 30%, Chief Executive Oliver Blume said on Friday, underscoring the structural pressures facing the German carmaker amid a broader industry downturn.
The cost gap reflects Volkswagen’s extensive model portfolio, which currently spans roughly 150 variants across its brands. Blume outlined plans to streamline the lineup to about 75 models by eliminating overlaps and reducing complexity, a process set to begin from 2027. The company does not expect competitive capacity utilization at its Emden, Hanover, Zwickau and Neckarsulm plants to return during the 2030s, he added.
Blume characterized the challenge as an industry-wide crisis rather than a Volkswagen-specific issue, warning that global automotive markets are unlikely to improve. “We can’t expect global markets to improve; on the contrary, risks will intensify,” he said in an internal interview cited by the company. Volkswagen has not yet assessed the potential impact of new Chinese competitors building plants in Europe, he added.
The automaker emphasized its commitment to maintaining a global presence, technological leadership and its manufacturing base in Germany, despite the financial strain. No decisions have been made regarding plant closures, and Volkswagen noted that many of its technical advancements remain underappreciated amid broader external financial pressures.
The company employs around 50,000 workers worldwide, a figure Blume cited to illustrate the scale of the cost disadvantage relative to competitors rather than as a fixed target for job reductions.
