Published by Oravbiere Osayomore Promise.
German premium carmaker BMW has announced plans to cut approximately 8,000 jobs by the end of 2027, primarily through a voluntary redundancy programme targeting administrative and development staff, as the company grapples with weaker-than-expected business in China, rising competition, and mounting cost pressures. The Munich-based automaker confirmed on Wednesday, July 29, 2026, that it had reached an agreement with employee representatives on a severance programme that will offer voluntary redundancy to about 40,000 of its roughly 85,000 permanent employees in Germany, with production line workers exempted from the cuts.
According to a company source familiar with the matter, the workforce is expected to shrink by around 8,000 people by the end of 2027. "We're planning on the basis of that," the source told AFP. The voluntary redundancy offers will begin in October 2026 and are expected to meaningfully reduce BMW's costs by 2028, with the bulk of departures coming next year. The plan took approximately six weeks to negotiate between the board and BMW's works council.
The job cuts come just weeks after BMW issued a shock profit warning in June 2026, slashing its outlook for the current year. The company cited a sharp decline in vehicle sales in China, where deliveries fell 30 per cent year-on-year in the three months to June, reaching their lowest level since 2017. Chief Executive Milan Nedeljkovic subsequently said the automaker would accelerate and intensify ongoing cost-cutting efforts. The costs of the restructuring this year are expected to run into the hundreds of millions of euros, though the exact figure remains uncertain and depends on how many employees accept the voluntary offers.
BMW's decision to cut jobs reflects the broader turmoil facing Germany's once-dominant automotive sector. Industrial companies in Germany cut 124,000 jobs last year, according to consultancy EY, roughly double the figure for 2024, with losses concentrated in the automotive industry. Volkswagen is reportedly weighing up to 100,000 job cuts across its 10 brands, while Mercedes-Benz has also launched its own voluntary redundancy programme. Mercedes-Benz CEO Ola Kaellenius, speaking at the carmaker's financial results presentation on Tuesday, acknowledged that "the whole sector could benefit from improved productivity, no two ways about it. The pressure is immense".
BMW had so far been widely seen as having weathered the storm better than its peers, having decided early on to maintain petrol and diesel options while still growing its electric vehicle sales. However, intense Chinese competition, slimmer margins on electric cars, and the threat of US tariffs have now caught up with the company. BMW's vehicle deliveries in China last year were already at their lowest level since 2017.
The redundancy programme is being implemented through natural staff turnover and a voluntary severance scheme in Germany, with the company and works council having agreed to exclude production operations from the cuts. BMW currently employs approximately 150,000 to 154,000 people worldwide. The offer will be open to German employees in desk-based roles, including those in administration and development divisions. The company had already signalled in its 2026 annual report that it expected a slight decline in employment levels, defined as up to 5 per cent of the workforce.
The job cuts come as BMW faces intensifying pressure to reduce costs across the board. The company's profit margin on its cars business could potentially fall to as low as one per cent this year, according to the profit warning issued in June. Restructuring measures are expected to cost the company in the second half of 2026. As German carmakers struggle to adapt to the rapid shift toward electric vehicles, intense competition from Chinese manufacturers, and an uncertain global trade environment, the industry is bracing for a prolonged period of consolidation and cost-cutting. For BMW, the voluntary redundancy programme represents a bid to streamline its operations without resorting to compulsory layoffs, but the scale of the cuts underscores the severity of the challenges facing one of Germany's most iconic industrial names.
📩 Stone Reporters News | 🌍 stonereportersnews.com
✉️ info@stonereportersnews.com | 📘 Facebook: Stone Reporters News | 🐦 X (Twitter): @StoneReportNew | 📸 Instagram: @stonereportersnews
Add comment
Comments