Volkswagen Shareholder Proposes Shifting China-Exclusive Models to German Production to Stabilize Local Capacity and Jobs

Olaf Lies, Minister-President of Germany's Lower Saxony state, has urged Volkswagen to shift production of certain models currently developed and manufactured in China to Germany. The move aims to boost capacity utilization at domestic plants and safeguard jobs. Lower Saxony holds 20% of Volkswagen’s voting rights, giving it significant influence over major corporate decisions. Volkswagen’s headquarters and five of its six assembly plants in western Germany are located in Lower Saxony. Earlier reports indicated that Volkswagen is considering closing four of its German plants and potentially cutting up to 100,000 jobs. Following a visit to China in April, Lies proposed exploring the possibility of producing vehicles destined for the Chinese market in Germany. Volkswagen currently faces mounting pressures from intensifying competition from Chinese automakers, rising U.S. import tariffs, and weakening demand in Europe, stating that its current business model is no longer sustainable. Additionally, media reports indicate that Porsche, a Volkswagen Group brand, is evaluating shifting production of its Cayenne model from Slovakia to its Leipzig plant in Germany to improve local capacity utilization.