Audi has announced plans to reduce its workforce by 7,500 employees by 2029 in an effort to enhance efficiency, agility, and adaptability within its German manufacturing facilities. This reduction accounts for approximately eight percent of the company’s global workforce and is part of a broader initiative to streamline operations and cut costs.
Audi Challenging Market Conditions
The company cited increasingly difficult economic conditions, intensifying competition, and political uncertainties as major obstacles. These factors, combined with slowing electric vehicle (EV) demand and strong competition from Chinese automakers in a key market, have significantly impacted the automaker’s performance.
Europe’s largest economy has been struggling with the transition to electric vehicles, and Audi is the latest car manufacturer to face setbacks. The German brand is grappling with declining demand for EVs and increased rivalry from local Chinese companies, making it harder to maintain its market share.
Workforce Reductions in Administration and Development
The job cuts will primarily affect administrative and development departments and will be implemented in a manner that avoids forced layoffs. The company has assured that the reductions will be conducted in a “socially responsible” manner, prioritizing voluntary departures and early retirement options. The company currently employs around 88,000 people worldwide, with 55,000 based in Germany.
Cost-Cutting Measures and Future Investments
As part of its strategy, Audi aims to reduce bureaucracy and generate annual savings of approximately one billion euros. Despite these cost-cutting measures, the company remains committed to investing in the future. Audi has pledged to invest around eight billion euros into its two primary production sites, Ingolstadt and Neckarsulm, to support the transition to electric mobility. This includes the development of a new entry-level electric model and advancements in artificial intelligence.
Declining EV Sales and Plant Closures
Audi has been significantly impacted by waning EV demand, leading to major restructuring efforts. In February, the company shut down its Brussels plant, which employed roughly 3,000 workers and focused on producing premium electric vehicles. Furthermore, the brand experienced an eight percent decline in fully electric vehicle deliveries in 2024, totaling approximately 164,000 units. The Chinese market, which accounts for nearly 40% of Audi’s global sales, saw an 11% drop in deliveries.
These workforce reductions at Audi follow Volkswagen Group’s broader restructuring efforts. In December, Audi’s parent company, Volkswagen, announced plans to cut 35,000 jobs at its core brand in Germany by 2030 as part of a larger effort to optimize operations and navigate the evolving automotive landscape.
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