Volkswagen, Europe's largest automaker, is undergoing a major restructuring as it faces unprecedented pressure to restructure its business model.The company plans to cut its model lineup by up to half and reduce annual production capacity to 9 million vehicles from 10 million.

This overhaul, expected to cost around 100,000 jobs, is driven by high costs, excess capacity, rising Chinese competition, and US import tariffs that have halved its profit margins since 2021.

CEO Oliver Blume has hinted at closing four German plants—Hanover, Emden, Zwickau, and Audi’s Neckarsulm site—and potentially doubling the number of job cuts compared to current plans.Workers have protested across sites, with unions warning of a 'major conflict' if cuts proceed.The restructuring also involves reducing offering complexity by 75% and focusing on high-demand market segments.

Despite efforts to avoid plant closures, the company faces challenges from labor representatives, Porsche owner families, and political pressures, as Germany struggles with weak growth and high labor costs.The move highlights the broader economic struggles facing Europe's automotive industry.