Why Some Investors Say Volkswagen Is Simply "Not Fixable"

According to Deutsche Bank analysts, Volkswagen's (ETR: VOWG_p) intricate governance structure and persistent cost problems have led many investors to regard the German automaker as effectively "not fixable," but the approval of its Zukunftsplan 2030 restructuring plan could start to undermine that view.

Skepticism among investors focused less on whether Volkswagen faced serious problems than on whether management could make the difficult decisions required to address them within the group's governance framework.

The recently approved Zukunftsplan 2030 offers some indication that it can. Its central restructuring targets remain largely intact, including approximately 50,000 job cuts by 2030 and plans to streamline the group's portfolio and business lines by roughly one-third.

Volkswagen also expects to use China more extensively as an export hub for the Global South, with management keeping its focus on margins, free cash flow, capital efficiency, and competitiveness.

German manufacturing remains a key challenge. Volkswagen has acknowledged around 500,000 units of excess European production capacity, and its plants in Emden, Zwickau, Hannover and Neckarsulm lack competitive successor vehicle allocations beyond the 2031–2034 period.

Rather than closing those facilities immediately, Volkswagen is giving them until June 2027 to reach competitive cost levels and potentially secure future production. Alternative uses for the plants are also being assessed.

Plant closures can count among the most expensive restructuring options, yet correcting Germany's structural cost disadvantage remains central to a sustainable turnaround. If competitiveness does not improve, vehicle production at the affected sites beyond the early 2030s is considered unlikely.

The agreement could have implications beyond Volkswagen at a time when European automakers are dealing with slower growth, excess manufacturing capacity, competition from China, and pressure on returns.

Execution is now the principal test. The agreement does not itself resolve Volkswagen's problems, but it speaks to a key investor concern by showing that difficult restructuring decisions can secure approval.

Deutsche Bank maintained its Buy rating and €115 price target on Volkswagen, compared with the September 3 closing price of €76.36, implying roughly 51% upside.