Volkswagen’s supervisory board faces a critical test on Sept. 4 as CEO Oliver Blume presses for sweeping cost reductions, while Germany’s Lower Saxony seeks a compromise amid competing restructuring proposals.
Niedersachsen, Volkswagen’s largest shareholder, expressed hope for a consensus ahead of the meeting, stating that a unified outcome would send a positive signal. ‘We are all working toward a Sept. 4 decision that yields a reasonable joint resolution,’ said Lies, the state’s representative, following a visit to the Osnabrück plant. However, insiders report that both the state and labor representatives have submitted separate proposals for the 395th supervisory board session—a highly unusual step at Volkswagen, where decisions are typically made unanimously.
Blume’s plan, which includes the elimination of tens of thousands of jobs and the potential long-term closure of multiple German plants, has already faced resistance. In July, Niedersachsen and labor representatives, holding 12 votes combined, opposed the proposal. Blume has since toured Volkswagen’s plants to outline his cost-cutting agenda, emphasizing the need to secure the automaker’s long-term competitiveness. ‘The path is not yet complete,’ he told workers in Emden, reiterating that Volkswagen must match the best European sites. He pledged continued support for struggling plants, stating that if no viable future assignments emerge, Volkswagen will still ‘fight for industrial perspectives and jobs.’
The automaker plans to reduce European production capacity by 500,000 vehicles annually. Blume highlighted that Emden, Zwickau, Hannover, and Neckarsulm currently lack competitive assignments for the 2030s. In Osnabrück, where the T-Roc Cabrio production ends next year, Lies said Niedersachsen is exploring ways to secure the plant’s future, aiming for a swift resolution. Reports suggest Israel’s Rafael Advanced Systems may be interested in converting the facility to produce components for its Iron Dome missile defense system, though Qatari investor Qatar has raised concerns. Lies cited the example of Meyer Werft in Papenburg, where state involvement helped rescue the struggling shipyard.
Volkswagen Works Council Chair Daniela Cavallo argued that the company’s transformation must extend beyond cost cuts, emphasizing the need for a forward-looking strategy centered on competitive products and technologies. ‘A future concept requires a forward strategy,’ she said. ‘It’s about competitive products and technologies.’ She warned that the scale of job reductions proposed by Blume may no longer be socially sustainable, adding that a comprehensive plan is essential for labor’s buy-in.
Blume has indicated that roughly 50,000 global jobs must be eliminated to meet overhead targets, with half of those cuts in Germany. In Emden, he noted that managerial roles would also be affected, with one in four management positions slated for elimination. ‘Every area must contribute,’ he stated.
