Volkswagen put a proposal to cut up to 100,000 jobs and close four German factories before its supervisory board on Thursday, triggering demonstrations at 18 sites across the country organized by IG Metall The Guardian. The protests, running from 11:20am to 2pm, targeted plants operated by VW, Audi, Porsche and the truck and bus maker Man.

The plan under discussion, championed by CEO Oliver Blume, would close plants in Hanover, Emden and Zwickau along with Audi's Neckarsulm site. Volkswagen has said up to 50,000 of the job losses are tied directly to those four closures. Those cuts would come on top of 50,000 reductions already agreed across the wider Volkswagen group, meaning the total headcount reduction under discussion could approach 150,000 positions Reuters. Volkswagen currently employs more than 650,000 people across a brand portfolio that includes Audi, Bentley, Skoda, Seat and Cupra.

IG Metall chair Christiane Benner used the demonstrations to put the blame for the company's troubles squarely on management, telling crowds that Blume cannot "pass the buck for failures of recent years on to the workforce." The union's position is bolstered by an unusual structural quirk in Volkswagen's governance. The Volkswagen Act — a set of statutes dating to the 1960s, originally designed to shield the company from hostile takeovers — requires a two-thirds supervisory board majority to approve plant closures at facilities it covers. That threshold makes closure of any Act-protected site all but impossible over union objection.

The math matters here in ways that go beyond ordinary corporate governance disputes. VW's supervisory board has 20 seats, split evenly in principle between shareholder and labour representatives. But as of Thursday only 19 seats were filled, leaving shareholder representatives with nine votes against labour's ten The Guardian. Labour representatives, in other words, currently hold an outright majority on the board — not merely a blocking minority — before the two-thirds requirement for Act-covered closures is even applied.

That arithmetic explains why Hanover and Emden, both covered by the Volkswagen Act, are effectively unreachable through this board absent a change in union posture. Zwickau and Neckarsulm sit outside the Act's protections, meaning their closure would not require supervisory board sign-off at all. That distinction creates a split track within Blume's own plan: two plants management can move on unilaterally, and two it cannot touch without labour's consent.

Beyond the factory closures, Volkswagen is weighing whether to carve out or spin off its core brand division along with its components and technology business. Such a restructuring would reshape how the group's flagship VW-badged operations relate to the rest of the conglomerate, though the company has not detailed timing or structure for any spin-off.

The dispute did not arrive without warning. Reuters first reported on June 26 that Volkswagen was considering shutting four German factories and cutting up to 100,000 jobs, citing two people familiar with the matter, and the Guardian's own reporting on the transformation plan predates Thursday's formal board presentation by nearly two weeks Reuters. The plans were leaked to media before being formally put to the board, a sequence that gave unions weeks to organize before the vote. In May, IG Metall had already staged a protest at VW-backed engineering firm IAV in Berlin over separate plans to cut 1,400 jobs by mid-2027, including the effective closure of IAV's Berlin site — a preview, in retrospect, of the mobilization capacity the union would bring to bear on the larger fight.

The backdrop that makes all this notable is a 2024 agreement between Volkswagen and its unions that explicitly ruled out plant closures in Germany France24. Management's current proposal would, for at least two sites, run directly counter to a deal reached less than two years earlier — a reversal that unions have cited as evidence the company is negotiating in bad faith, even as Volkswagen frames the plan as a response to deteriorating competitiveness.

Germany's auto trade body, the VDA, warned on July 8 of a potential employment collapse across the wider sector, a signal that the stakes extend well past Volkswagen's own payroll into the supplier base that depends on it. Supervisory board chairman Hans Dieter Poetsch, who addressed the company's annual general meeting on June 11, has staked his chairmanship's credibility on steering the group through what Blume has called a necessary transformation.

The governance mechanics here matter as much as the politics. A management team can propose whatever restructuring it judges necessary, but German codetermination law and the Volkswagen Act's supermajority requirement mean labour's cooperation is not optional — it is structurally load-bearing. Blume's team appears to have built its plan around that constraint, targeting Zwickau and Neckarsulm precisely because they sit outside it, while leaving Hanover and Emden as leverage points for a negotiated settlement. Whether that produces a genuine compromise or a prolonged stalemate will likely depend less on Thursday's demonstrations than on what shareholder representatives do about the board's vacant twentieth seat.