Azernews.Az

By Alimat Aliyeva

Shares of Volkswagen AG rose by as much as 7% shortly after European markets opened on Friday. The company announced on Thursday that its board had unanimously approved a series of cost-cutting measures aimed at improving its financial performance.

As part of the plan, Volkswagen intends to cut around 50,000 jobs by 2030. The automaker also plans to reduce its model portfolio by approximately 50% and restructure its leadership team. The company is targeting an operating margin of 9% and plans to keep capital expenditure at around €135 billion.

Volkswagen’s shares were up 5.45% at 9:12 a.m. CET, although the stock remains down 26.6% since the beginning of the year.

The positive reaction from investors suggests that the market sees the restructuring plan as a potential step toward making Volkswagen more efficient and competitive. However, cutting thousands of jobs and reducing the number of models is a major challenge for one of Europe’s largest carmakers.

Interestingly, Volkswagen is facing growing competition from Chinese electric vehicle manufacturers, while the global auto industry is rapidly shifting toward electric and software-driven vehicles. The success of the company’s new strategy could therefore play an important role in determining its position in the automotive market over the next few years.