Lower Saxony Premier Olaf Lies urged all parties to reach a Volkswagen restructuring agreement before the September 4 supervisory board meeting. CEO Oliver Blume seeks to double planned job cuts to as many as 50,000, potentially closing factories and spinning off divisions. The state, which holds a blocking minority shareholding, is seeking a compromise on the scale of cuts and factory futures.
Lower Saxony Premier Olaf Lies urged a Volkswagen restructuring deal before the September 4 board meeting as CEO Oliver Blume seeks 50,000 job cuts.
"I strongly urge that we use the time remaining until the next meeting to bring the different positions together," Lies told a briefing with journalists on Friday.
Blume wants to double planned job cuts to as many as 50,000, possibly close factories and spin off some company divisions in a radical drive to slash costs across the group. That has triggered fierce opposition from unions and strong concern from Lower Saxony, which holds an effective blocking minority shareholding in Europe's largest automaker.
The two sides are seeking a compromise likely to center on the scale of job cuts and future plans for factories at risk, according to sources familiar with the discussions. Lies said VW had always combined economic prudence with social responsibility, "and the solution we are now seeking should be measured against that standard."
The business challenges facing Volkswagen — costly tariffs, falling demand and mounting competition from China — need to be handled urgently, Lies said. But he cautioned that the group's position in the wider industrial environment also had to be considered.
"With its sites in Lower Saxony and across Germany, its tens of thousands of employees and their families, and its suppliers and service providers, Volkswagen also bears an enormous responsibility for the wider economy and society," he said.
VW's executive committee, which includes the works council chief, Lies and members of the Porsche and Piech shareholder families, is set to convene Thursday, a day ahead of the supervisory board meeting, to assess where negotiations stand.
The restructuring battle has already strained relations between management and labor. VW's labour chief said earlier this week that confidence in Blume had been damaged but could be repaired, while the CEO told staff the cost-cutting journey was not over.
The stakes extend beyond VW's factory floors. The automaker employs tens of thousands of workers across Germany, and its suppliers and service providers depend on its production volumes. A prolonged standoff could ripple through the broader German economy, which has already been hit by high energy costs and weak industrial demand.
The outcome will determine whether VW can push through its most aggressive restructuring in decades. A failure to reach a deal could trigger prolonged uncertainty, potential strikes and production disruptions across the automaker's German operations, weighing on a company that already faces intense competitive pressure from Chinese EV makers. Investors will watch the September 4 board meeting for clarity on the scale of job cuts and which factories face closure.
This article is for informational purposes only and does not constitute investment advice.
