VW's software subsidiary Cariad plans to cut 1,000 jobs

More Layoffs VW's Software Subsidiary Cariad Is Facing More Extensive Job Cuts

2026-10-02 Source: dpa 2 min Reading Time

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According to information obtained by dpa, the job cuts at Volkswagen's software subsidiary involve no fewer than about 1,000 positions ...

Cariad, Volkswagen's software subsidiary, continues to struggle. Now, another round of layoffs has been announced, which will result in the loss of many jobs ...(Image: Cariad) — Cariad, Volkswagen's software subsidiary, continues to struggle. Now, another round of layoffs has been announced, which will result in the loss of many jobs ...
(Image: Cariad)

The dpa has learned from company sources that many jobs at Cariad are reportedly at risk. This would affect just under a quarter of Cariad’s approximately 4,300 remaining employees. The Handelsblatt had previously reported on this. It remains unclear when and how the job cuts will be implemented. Negotiations on the details are now set to begin with employee representatives. Collective bargaining agreements have also reportedly been terminated. A Cariad spokesperson declined to comment when asked. As the *Handelsblatt* further reported, Cariad informed employees about the job cuts, among other things, at a staff meeting yesterday. The company stated that these cuts are necessary to ensure competitiveness compared to external software providers. According to the report, the company plans to cut its investments by approximately 6.1 billion euros ($6.954 billion) from 2027 to 2031. At the start of the next decade, Cariad also intends to contribute an additional 400 million euros ($456 million) toward the planned improvement of the group’s operating profit. The Executive Board’s strategic plan, which aims to make the group more profitable by 2030, also calls for billions in cuts to development budgets and the elimination of as many as tens of thousands of jobs.

Oliver Blume's Shift Toward Software Changed a Lot

Cariad's software systems are used throughout the Volkswagen Group. Originally, the subsidiary was supposed to develop large portions of the software itself. Due to problems with key projects—which also delayed the launch of certain models—the automaker replaced Cariad’s leadership in 2023 and changed course. And unlike his predecessor Herbert Diess, VW Group CEO Oliver Blume is currently focusing on collaborations with external partners such as Xpeng in China and Rivian in the U.S. when it comes to software. Cariad is therefore now focusing, among other things, on in-house development of key technologies, such as driving dynamics software, cloud applications, and infotainment systems. The software subsidiary had already cut jobs several times in previous years. At the end of 2023, Cariad still had 6,500 employees. Most recently, the job cuts were carried out in a socially responsible manner through severance packages and early retirement programs. Layoffs for operational reasons had most recently been ruled out until 2029.

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