Volkswagen shares hit an 11-week high Friday after the supervisory board of Europe's largest automaker struck an ambitious turnaround agreement that put the focus on sweeping job cuts and averted a clash between major stakeholders.
The deal announced late Thursday on the biggest restructuring in the group's 89-year history includes a further 50,000 job cuts, bringing the total agreed to 100,000, and leaves open the future of four of its German plants.
Volkswagen, like most of its European peers, is under pressure from painful tariffs in the United States, falling sales in former cash cow China and aggressive Asian rivals entering the stagnant European market.
All these factors have gnawed at the group's operating margin, which stood at 3.8% in the first half, down from 7.9% in 2022, its peak over the past decade.
Shareholders and analysts expressed relief that Volkswagen – with a workforce of more than 650,000, a complex structure and powerful stakeholder groups – is still able to make far-reaching decisions in times of crisis.
