VW's controlling families push for swift restructuring action

Volkswagen's controlling families have intensified pressure on the German automaker's stakeholders, throwing their weight behind management's push for a sweeping restructuring that could involve tens of thousands more job cuts.

Hans Dieter Poetsch, chairman of Porsche SE — the investment vehicle of the Porsche/Piech dynasty and Volkswagen's largest shareholder — said the group stands "at a historic crossroads." He urged all parties to take responsibility, warning that "the longer decisions are delayed, the bigger the problems will become."

CEO Oliver Blume has pledged a drastic overhaul of the group, which spans the mass-market VW brand, premium marques Porsche and Audi, and luxury label Lamborghini. The company is grappling with high costs, tariff-related headwinds, and intensifying competition from Chinese automakers.

Porsche SE finance chief Johannes Lattwein called for reducing excess capacity, cutting costs significantly, and streamlining decision-making. "Competitiveness is the goal. Every option must be considered in pursuing it," he said.

Blume's latest plan, which follows tens of thousands of job cuts already implemented, reportedly threatens another 50,000 positions and the possible closure of four German plants. The proposal requires approval from powerful labour representatives and the state of Lower Saxony, which holds a 20% blocking stake, setting the stage for tense negotiations in the coming months.

Sources indicate that labour representatives and Lower Saxony voted against the plan at the last supervisory board meeting in July. The next meeting is expected in early September. Volkswagen declined to comment, though a company source said Porsche SE's position was seen as backing for Blume's restructuring course.

Porsche SE, which owns 31.9% of Volkswagen and 12.5% of Porsche, reported a 14.5% drop in adjusted half-year earnings after tax to €949 million. Including impairment losses on its core investments, the holding swung to a net loss of €2.2 billion for the first half, down from a €338 million profit a year earlier. Shares in the holding fell 1.5% following the earnings release.