Volkswagen layoffs: Company to cut 12% workforce in India, ‘to save tens of millions of dollars’

Volkswagen Group's India business plans to cut around 12% of its workforce as the company looks to reduce costs before entering its next investment cycle in the country. The German automaker is the latest, after Ford, Nissan and Stellantis, among others, to cut costs as the sector faces challenges, including electric vehicles (EVs) that remain too expensive for consumers.

The overhaul is expected to save Volkswagen tens of millions of dollars in India by the time it starts launching its next generation of vehicles, including a new electric model.

“While we do not comment on speculative figures regarding our workforce, our ongoing efforts to optimize operations across our Indian business units continue to gain momentum,” Piyush Arora, managing director and chief executive officer of Skoda Auto Volkswagen India, told Bloomberg.

The cost reset also comes as Volkswagen weighs an equally consequential overhaul of its India ownership. The German automaker is closing in on a deal that could give billionaire Sajjan Jindal’s JSW Group a controlling stake and bring fresh capital into the business, people familiar with the matter told Bloomberg.

The automaker has been cutting jobs and facing pressure from its powerful German unions for years. Its workforce in Germany fell from 275,000 in 2023 to 254,000 as of June 30, 2026, according to CNN.

Volkswagen buyers will not only have fewer models to choose from but also less flexibility to customise their cars with specific features. The company has said it will reduce the "complexity" of the cars it builds by 75%.

50,000 job cuts expected in Germany

Around 50,000 job cuts are also expected in Germany, Lower Saxony's state premier Olaf Lies told Reuters, adding that there is no agreement on plant closures.

Stopping car production at plants such as Emden or Hanover, both in his northern German state, is unimaginable, Lies said. He added that there was a chance to retain production at German plants by looking at other options.

Lies, who is also a member of the group's supervisory board, said, "The day before yesterday, there was talk of closing the plants. With the decision (on the group's future), there is an opportunity to create prospects both in car manufacturing and, where that might not be possible, through other ways."

The group's supervisory board, of which Lies is a member, on Thursday reached a turnaround agreement that focuses on job cuts and helped avert a clash between major stakeholders.

Volkswagen's portfolio includes brands such as Audi, Porsche and Lamborghini, alongside its Volkswagen brand and other offerings.