VW slashes model lineup by up to 50% after boardroom clash

Volkswagen has announced plans to cut its global model lineup by as much as 50% following a contentious July 9 supervisory board meeting in Wolfsburg. The move comes as the automaker faces mounting pressure from shrinking profits in China, tepid demand in Europe, U.S. tariffs, and intensifying competition from Chinese brands. CEO Oliver Blume had sought to double job cuts to 100,000 and close four German plants, but the board stopped short of approving those measures. Instead, Volkswagen will focus on reducing “offering complexity” by trimming its sprawling portfolio of roughly 150 model lines across brands including Porsche, Audi, Skoda, and commercial vehicles. The company did not specify a timeline for the reductions or which brands would be most affected. “The business model of developing and making cars for export from Germany isn’t viable anymore,” Blume said, underscoring the urgency of restructuring. The plan builds on a 2024 agreement with labor unions to cut over 35,000 jobs at the VW brand in Germany by 2030, though management argues these cuts are insufficient given worsening conditions in key markets. Labor leader Daniela Cavallo issued an ultimatum to Blume, demanding he address workers by July 10 or face extraordinary meetings after the summer break. The impasse highlights the challenges of restructuring Volkswagen, where labor representatives hold half the seats on the supervisory board and the state of Lower Saxony wields significant influence. The board’s decision reflects a strategic pivot toward higher-return segments, prioritizing development resources where they can generate the greatest financial impact amid a deteriorating economic and political landscape.