VW closes factory in Germany for the first time
Volkswagen is halting car production at one of its plants in Germany on Tuesday, for the first time in its 88-year history, Kallanish said. This concerns the production line in Dresden.
The move comes at a time when Europe's largest automaker is under enormous pressure due to weak demand and sales in both China and Europe, as well as increased tariffs in the United States.
Volkswagen is struggling to allocate its investment budget of about 160 billion euros ($187 billion) over the next five years, and the company continues to look for ways to cut costs and increase operating profits.
Since production began in 2002, less than 200,000 vehicles have been produced at the Dresden plant, which is less than half of the annual production of the central plant in Wolfsburg. The closure is part of an agreement reached with unions last year under which VW will also cut 35,000 jobs in Germany.
The plant's territory will be leased to the Technical University of Dresden to create a research campus for the development of artificial intelligence, robotics and chips. VW has promised to invest 50 million euros over the next seven years in a joint project with the university, while continuing to use the plant as a dealership for delivering cars to customers and as a tourist attraction.
Volkswagen is also preparing major changes in its development strategy. They should allow the company to maintain its focus on electrified models, make electric vehicles more affordable and have a larger range.
That's why VW's future lineup in Europe and North America will be filled with vehicles built on the sequential hybrid principle. These are the so-called extended-range electric vehicles (EREVS), which are very popular in China but have not yet become widespread in Europe and North America.
Volkswagen reports that the introduction of electric vehicles (EV) is slower than expected, and the main reason for this is consumer concern about the range of the car. The EREV system solves this problem.
Investments in such hybrids will be part of a new strategic plan for the next five years. This document will be published in March 2026 and is expected to take into account the upcoming postponement of the EU ban on the use of internal combustion engines (ICE). The EU is expected to announce changes to this policy on December 16.
Earlier, German defense manufacturer Rheinmetall said it was considering the possibility of acquiring one of Volkswagen's plants, which will soon be