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Oliver Blume secures board approval for Volkswagen's 50,000-job cut and model portfolio reduction

Volkswagen's board of directors approved a sweeping cost-cutting plan that would reduce the company's workforce by approximately 50,000 positions, including management roles. This plan, proposed by CEO Oliver Blume, aims to counter low-cost competition from China and U.S. tariffs. The restructuring includes slimming the company's model portfolio by 50% by 2035 and creating a flatter leadership structure with shorter lines of decision. The board's decision follows a 30% drop in after-tax earnings for the first half of year, largely due to sales slumps in China and tariff expenses reaching 2.9 billion euros for the full year of 2025. The plan also calls for ending auto production at four German plants—Emden, Zwickau, Hanover, and Neckarsulm—as future production allocation cannot be secured for these sites from 2031 to 2034. Oliver Blume stated that the plan will make the company's iconic brands more attractive and competitive. The move received unanimous board backing despite initial resistance from employee representatives and the regional government of Lower Saxony.

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