The internal crisis at Germany’s largest automaker, Volkswagen, is far deeper and more acute than market analysts had previously believed. Citing confidential results of an anonymous senior management survey, Der Spiegel reports that the company’s current financial and operational condition is in a critical phase. According to the magazine, six of the nine sitting members of the board of management officially described the situation as “threatening the very existence” of the business. The other three executives called the state of affairs “strained,” with none of the respondents judging the problems to be “non‑critical.”
The principal destabilizing factor is a sharp deterioration of Volkswagen’s positions in key international markets. All nine respondents to the closed survey agreed unanimously that the company needs immediate and radical structural changes in China and North America, where the brand is rapidly losing market share to local competitors and electric vehicle manufacturers. Such unanimity at the top suggests that a hard revision of the group’s global investment and product strategy is inevitable in the near term.
To preserve financial stability and boost operating efficiency, Volkswagen’s management has already launched an extensive austerity program. As part of cost optimization, the automaker plans unprecedented job cuts. Roughly 19,000 positions will be eliminated at its German plants and offices alone by the end of 2026. Industry experts warn that a deep crisis at an industrial heavyweight like Volkswagen could deliver a serious economic blow to Germany’s manufacturing sector and provoke rising social tensions in the domestic market.
