Volkswagen to fire 12% of its India workforce amid major cost overhaul

Volkswagen Group’s India unit is accelerating a three-year restructuring plan that will eliminate about 12% of its workforce, people familiar with the matter said, as the German automaker looks to lower costs before its next investment cycle in the country.

Skoda Auto Volkswagen India Pvt. began the overhaul in 2025 but has moved to tighten the timetable, with reductions now being carried out in quicker tranches through 2027, the people said, asking not to be identified discussing internal matters. A few hundred white-collar and shop-floor jobs are expected to disappear over the course of the program, they said.

Also read: Volkswagen to cut 100,000 jobs by end of decade in biggest restructuring in global auto industry


The overhaul is intended to save tens of millions of dollars at its India operations by the time Volkswagen begins launching its next generation of vehicles, including a new electric model, the people said. The company is trying to enter that investment phase with a leaner cost base after struggling to gain scale in one of the world’s fastest-growing auto markets.

“While we do not comment on speculative figures regarding our workforce, our ongoing efforts to optimize operations across our Indian business units continue to gain momentum,” said Piyush Arora, managing director and chief executive officer of Skoda Auto Volkswagen India. Moving forward, the company expects to expand its local engineering team and deepen its investment in India as a key manufacturing, engineering and export hub for the group, he said.

The reductions are playing out against a far broader retrenchment at Volkswagen. CEO Oliver Blume secured the supervisory board’s backing for a global overhaul that includes cutting 50,000 additional jobs, halving its vehicle model lineup by 2035 and reining in 2027-2031 capital spending by 16%.

The cost reset also comes as Volkswagen weighs an equally consequential overhaul of its India ownership. The German automaker is closing in on a deal that could give billionaire Sajjan Jindal’s JSW Group a controlling stake and bring fresh capital into the business, people familiar with the matter said earlier.

The India program is separate from Blume’s broader global restructuring, the people said, adding that it’s tied to the needs of the domestic business to pull funding from its already struggling headquarters, and is due to run through 2027.

Still, both plans reflect the pressure on Volkswagen to wring costs out of its operations as the global auto industry confronts slowing demand in some major markets, expensive EV investments and intensifying competition from Chinese manufacturers.

In India, the task is complicated by Volkswagen’s relatively small presence after more than two decades in a market dominated by Maruti Suzuki India Ltd. and Hyundai Motor India Ltd.. Local manufacturers Tata Motors Passenger Vehicles Ltd. and Mahindra & Mahindra Ltd.