BMW is going to cut 8,000 jobs by 2027 because the German auto industry is under a lot of stress
BMW intends to reduce its workforce by approximately 8,000 positions in Germany by 2027 due to declining demand and increasing costs affecting the automotive sector.
BMW has revealed intentions to reduce its workforce by approximately 8,000 positions in Germany by the end of 2027 through a voluntary redundancy program. This move aligns with a trend among major automakers facing weak demand and increasing cost pressures impacting the automotive sector in the country.
The workforce reduction, which has been agreed upon with the company’s works council, will mainly impact employees in the administrative and research and development divisions, while production workers will not be included in the program, according to a company spokesperson.
A source familiar with the matter indicated that the restructuring is anticipated to decrease BMW’s workforce by approximately 8,000 employees. The automaker based in Munich currently has a workforce of approximately 150,000 individuals across the globe.
BMW is aligning with other German automakers in adopting cost-cutting strategies as the industry navigates the expensive shift to electric vehicles, heightened competition from Chinese manufacturers, and the effects of US tariffs. Volkswagen and Mercedes-Benz have announced their intentions to cut tens of thousands of jobs.
Earlier this week, Porsche, a member of the Volkswagen Group, announced an expansion of its restructuring program, aiming for a 20% reduction in its workforce by 2035.
On Wednesday, thousands of Audi employees gathered to protest at the company’s Neckarsulm plant, one of four German locations facing potential closure as part of Volkswagen’s extensive restructuring plans.
BMW, long seconsideredne of Germany’s more resilient automakers, adjusted its profit outlook in June following weaker-than-anticipated sales in China, where vehicle demand has significantly decreased in recent months.
In light of the updated forecast, Chief Executive Milan Nedeljkovic stated that the company would intensify its cost-reduction initiatives to enhance profitability and bolster its competitive stance.
During a workers’ assembly in Munich on Wednesday, Nedeljkovic addressed employees, stating that the automotive industry has experienced fundamental changes that are reshaping the market and posing challenges to BMW’s long-standing business model, as reported by a participant at the meeting.
He recognized the challenging business landscape that lies ahead yet emphasized that the proposed measures are crucial for enhancing BMW’s financial performance, bolstering its competitiveness, and fostering its long-term growth.
BMW is set to announce its second-quarter earnings on Thursday, with investors keenly anticipating additional insights into the company’s financial performance and future outlook.
