Audi has announced plans to eliminate up to 7,500 positions in Germany by 2029, primarily targeting administrative and development departments. This decision comes after management and labor representatives reached an agreement on Monday, marking a significant shift in the German luxury automaker’s operational strategy.
The cuts are expected to generate annual savings of €1 billion in the medium to long term. Despite these reductions, Audi has committed to investing €8 billion in its German manufacturing facilities over the next four years.
This move places Audi’s cuts within a larger restructuring effort across the Volkswagen Group. The combined workforce reductions now approach 48k positions, with Volkswagen itself cutting 35k jobs, Porsche eliminating 3,900, and the software division Cariad reducing its workforce by approximately 1,600 employees.
Audi announcement follows a previous round of cuts that began in 2019, which saw approximately 9,500 production jobs eliminated. That earlier restructuring was intended to free up capital for Audi’s transition to electric vehicles while boosting profit margins to between 9% and 11%.
Audi’s financial performance has deteriorated substantially over the past year. Operating profit margins plummeted from 7% in the first three quarters of 2023 to just 4.5% during the same period in 2024. The company attributes this decline to weak sales performance in key markets and financial impacts from shutting down its Brussels factory.
The luxury automaker now faces the challenging task of balancing necessary cost reductions while maintaining its competitive position in the premium automotive segment. As Audi trims its workforce, questions remain about whether these cuts will provide the financial runway needed to navigate the industry’s electric transition.
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