Skip advert
Advertisement

Volkswagen Golf moves to Mexico, as German giant sheds 35,000 jobs

Huge restructuring also sees VW slash domestic capacity by 750,000 cars

Volkswagen Golf - front action

VW’s iconic Golf hatchback is following in the wheeltracks of its Beetle ancestor to a second life in Mexico, as the company announces a huge restructuring that will cost 35,000 jobs in Germany by 2030.

The firm announced today that it has concluded a joint agreement with unions to make desperately needed changes to improve competitiveness in a rapidly changing global market. The package of measures will ultimately reduce VW’s domestic German capacity by three-quarters of a million vehicles, as the firm attempts to reposition itself as the self-proclaimed “technology leading manufacturer globally”.

Advertisement - Article continues below

VW says the package named 'Zukunft Volkswagen’ or ‘future Volkswagen’, will save an eye-watering 15 billion Euros annually in the mid-term, with the reduction in labour costs alone saving a whopping 1.5bn, while measures to consolidate production will save 4bn annually.

Those measures include the end of vehicle production at VW’s so-called ‘Transparent Factory’ in Dresden, a glass-fronted edifice which has previously accommodated production for the Volkswagen Phaeton and Bentley Flying Spur, and has more recently been the home of electric Golf models and the ID.3. As recently as 2021, VW was pledging to continue to develop Dresden into the "Home of ID in the coming years”, but the pace of the onslaught from cheap Chinese brands and slower than anticipated consumer take-up of pure-electric models has forced a radical rethink. 

Skip advert
Advertisement
Skip advert
Advertisement - Article continues below

As part of this restructuring, the ID.3 and Cupra Born models will move to Wolfsburg, while the Golf hatch and estate make the journey overseas to VW’s Puebla, Mexico plant. Wolfsburg’s future will further be secured at the end of the decade with the introduction of the electric Golf and another model based on the future SSP electric car architecture, the company says.

In a statement issued on 23 December, VW said: “At company level, the company and employee representatives have agreed to realign the production capacities of the German Volkswagen plants with new structures and technologies to ensure competitiveness. To this end, production capacity in Germany will be reduced by approximately 734,000 units. The company is thereby responding to the decreasing automotive market in Europe and the increasingly fierce competition, while at the same time creating the fundamental requirements for continued commercially viable production at its home base in Germany.”

Thomas Schäfer, who is CEO of the Volkswagen Passenger Cars brand, says the agreement addresses three priorities the firm set out to ensure the future viability of VW: “Reduce overcapacity in Germany, reduce labour costs and achieve competitive development costs. With the agreed package of measures, we have thus created the basis for making Volkswagen the technologically leading volume manufacturer by 2030 - with a clear plan, strong products and a clear commitment to Germany as a business location.”

Want the latest car news in your inbox? Sign up to the free Auto Express email newsletter...

Skip advert
Advertisement
Current affairs and features editor

Chris covers all aspects of motoring life for Auto Express. Over a long career he has contributed news and car reviews to brands such as Autocar, WhatCar?, PistonHeads, Goodwood and The Motor Trader.

Skip advert
Advertisement

Recommended

Best-selling cars 2026: the year's 10 most popular models so far
Best-selling cars March 2026 - header image

Best-selling cars 2026: the year's 10 most popular models so far

These are officially Britain’s biggest-selling new cars so far in 2026, according to the Society of Motor Manufacturers and Traders (SMMT)
Best cars & vans
9 Apr 2026
Best plug-in hybrids to buy 2026
Best plug-in hybrid cars - header image March 2026

Best plug-in hybrids to buy 2026

The plug-in hybrid market has grown exponentially in recent years. Here are our electrified favourites
Best cars & vans
20 Mar 2026
Rising fuel prices mean paying extra for a more efficient car can save you big money
Fuel prices and efficient cars - opinion

Rising fuel prices mean paying extra for a more efficient car can save you big money

Auto Express’ consumer reporter explains how recent global events should focus car buyers’ attention on the fuel economy of their next purchase
Opinion
12 Mar 2026
New Mk9 VW Golf and ID. Golf twins to keep hybrid and EV options open for buyers
New VW Golf Mk9 silouette

New Mk9 VW Golf and ID. Golf twins to keep hybrid and EV options open for buyers

The new-look Volkswagen Golf and ID. Golf will sit side by side, as boss commits to a multi-fuel strategy on the new SSP platform
News
12 Mar 2026

Most Popular

We got it wrong: VW ID.3 and ID.4 will be replaced by “true Volkswagens”
Volkswagen ID.3 - front and rear

We got it wrong: VW ID.3 and ID.4 will be replaced by “true Volkswagens”

The inside story on how the people’s car maker lost touch with the people, before rediscovering its mojo under boss Thomas Schäfer
News
10 Apr 2026
Car Deal of the Day: Tesla Model 3 for £197 a month is the ultimate high fuel price hack
Tesla Model 3 - front cornering

Car Deal of the Day: Tesla Model 3 for £197 a month is the ultimate high fuel price hack

Elon’s Musk’s big-seller is a premium-feeling and efficient electric saloon. It’s our Deal of the Day for April 10
News
10 Apr 2026
New Ford Explorer Van revealed for those seeking more style than a humble Transit
New Ford Explorer Van - front angled

New Ford Explorer Van revealed for those seeking more style than a humble Transit

Explorer Van has arrived as an official conversion from Ford’s team in Dagenham
News
9 Apr 2026

Find a car with the experts