Volkswagen Stock: Major Job Cuts Amid Transformation Drive

Volkswagen AG is embarking on an extensive transformation program aimed at achieving annual cost savings exceeding 4 billion euros. The automotive giant plans to reduce its workforce by 35,000 positions in Germany by 2030, with the majority of cuts - approximately 29,000 jobs - concentrated in Lower Saxony. This restructuring initiative, which aims to trim labor costs by 1.5 billion euros, will be implemented without forced redundancies. Management is participating in the austerity measures with a substantial contribution of over 300 million euros, with the executive board taking on a disproportionate share. Additionally, the company intends to decrease its technical capacity at German locations by more than 700,000 vehicles.

Market Response and Strategic Developments

Despite reporting a significant decrease in quarterly earnings per share from 7.76 euros to 2.42 euros year-over-year, Volkswagen's stock demonstrated resilience, rising 0.5 percent to 89.96 euros in XETRA trading. The company's revenue experienced only a minimal decline of 0.47 percent to 78.48 billion euros in the last quarter. Analysts maintain an optimistic outlook, setting an average price target of 110.20 euros, substantially above current trading levels. The company's strategic partnership with a Chinese electric vehicle manufacturer for developing an extensive charging network in China has further bolstered investor confidence.