Volkswagen controlling families call for faster overhaul to fend off Chinese rivals

Volkswagen's top investor and controlling family shareholders have delivered a clear message to management regarding the German auto giant's potential radical overhaul. Europe's largest carmaker is contemplating job cuts of up to 100,000, twice the previously estimated figure, in response to a profit slump and mounting tariff costs.

The company is also facing increased competition from Chinese car brands. Hans Dieter Pötsch, chairman of Porsche SE, emphasized that "The decisions that Volkswagen makes now will determine its future." He urged everyone to take responsibility and step up. Johannes Lattwein, a member of Porsche SE's board responsible for finance and IT, stressed that "it is imperative" for Volkswagen to reduce excess capacity, significantly lower costs, and strengthen decision-making and execution capabilities.

Lattwein reiterated that Porsche SE supports the group board of management and its proposals, aiming to boost competitiveness. The Porsche and Piëch families, through their holding company Porsche SE, control Volkswagen with a 31.9% stake and 53.3% voting rights. The statements come after Porsche SE reported a 14.5% drop in adjusted half-year earnings after tax, amounting to 949 million euros.

Volkswagen's shares traded 1% lower on Friday morning, down nearly 28% year-to-date. Volkswagen CFO Arno Antlitz acknowledged the industry's challenges and hinted at exploring various options, including outsourcing plant capacity to the defense industry to avoid closures. He reaffirmed the company's focus on reducing costs, increasing productivity, and optimizing plant capacities.