In recent days, Volkswagen confirmed a major cost-cutting and restructuring drive, including plans for up to 100,000 job reductions worldwide and a streamlined model lineup, as it responds to intense competitive and cost pressures.
An important twist is that management is emphasizing product and complexity reductions over outright factory closures, even as the future of several German plants remains uncertain and labor opposition complicates implementation.
Next, we will examine how Volkswagen’s push to close a roughly 20% cost gap with rivals could reshape its investment narrative.
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Volkswagen Investment Narrative Recap
To own Volkswagen today, you have to believe the group can translate its complex, multi-brand scale into better margins while absorbing heavy spending on electrification, software, and restructuring. The latest plan to cut up to 100,000 jobs and simplify the model range directly targets its biggest near term issue: high costs pressuring already thin margins. At the same time, execution risk around restructuring now looks more immediate than tariff or BEV competition risks in the short term.
The most relevant recent announcement here is Volkswagen’s confirmation that it aims to close a roughly 20% cost gap with rivals, partly by halving its model lineup and trimming global capacity to 9 million vehicles a year. This push sits alongside weaker recent results, with full year 2025 net income of €7,323 million compared with €11,351 million a year earlier, underscoring how much hinges on whether the restructuring improves profitability without undermining future growth options.
Yet while this cost push could help protect margins, investors should also be aware that…
Read the full narrative on Volkswagen (it’s free!)
Volkswagen’s narrative projects €347.0 billion revenue and €14.4 billion earnings by 2029. This requires 2.7% yearly revenue growth and an earnings increase of about €8.3 billion from €6.1 billion today.
Uncover how Volkswagen’s forecasts yield a €111.54 fair value, a 56% upside to its current price.
Exploring Other Perspectives 
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Some of the most optimistic analysts once projected revenue of about €359,100 million and earnings near €18,000 million, but this aggressive restructuring and execution risk could mean those expectations and more cautious views may both need revisiting.
Explore 4 other fair value estimates on Volkswagen – why the stock might be worth just €111.54!
Reach Your Own Conclusion
Disagree with existing narratives? Extraordinary investment returns rarely come from following the herd, so go with your instincts.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include VOW3.DE.
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