Volkswagen targets 20% cost cuts by 2028 amid market pressures – report

Volkswagen plans group-wide cost reductions of 20% by 2028 as it confronts rising expenses, weak demand in China and US tariffs.

According to a Reuters report, which cited German trade publication Manager Magazin, CEO Oliver Blume and CFO Arno Antlitz outlined what was described as a “massive” cost-saving drive during a closed-door session with senior executives in Berlin in mid-January.

Details on where reductions would fall and how brand collaboration would be enhanced were not disclosed, though potential plant closures were said to be under consideration.

In an emailed statement to Just Auto, a Volkswagen spokesperson said the company is currently in the quiet period, therefore it “cannot make any statements or provide any assessment on financial matters that could influence the share price”.

The group’s full-year 2025 results are due next month.

Three years ago, the Volkswagen Group rolled out a group-wide operational programme aimed at preparing the business for the future across all brands and units, concentrating on customer-facing priorities like design, product offerings, and cost efficiency.

“Since then, it has achieved savings in the double‑digit billion‑euro range. This has enabled the group to cushion geopolitical headwinds—such as tariffs in the US – and stay on course”, the spokesperson added.

The group is also implementing plans to reduce 35,000 positions in Germany by 2030.

In January, its core Volkswagen marque said it would cut management roles and streamline its production architecture, aiming for €1bn ($1.16bn) in savings over the same timeframe.

German carmakers are facing stronger competition in China amid aggressive pricing by domestic rivals, while Volkswagen’s investment in software and the parallel development of combustion and electric platforms remains high, according to the report.

Blume is expected to provide further details at Volkswagen’s annual results press conference on 10 March.

Separately, Volkswagen has been ordered by a Paris court to stand criminal trial in France over its involvement in the diesel-emissions scandal.

The company will face accusations of deceit “concerning goods that endanger human and animal health”.

Proceedings are unlikely to begin before 2027, with scheduling to be discussed in December this year.

“Volkswagen targets 20% cost cuts by 2028 amid market pressures – report” was originally created and published by Just Auto, a GlobalData owned brand.

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