Volkswagen Faces Board Opposition in Push to Overhaul Company
Volkswagen is preparing to push forward its most significant restructuring plan yet amid internal opposition from unions and Lower Saxony, a major shareholder. The supervisory board will meet on September 4 to discuss management's proposal, which includes doubling job cuts, closing factories, and spinning off divisions—moves that have drawn resistance due to concerns over worker layoffs and site closures. If the plan is rejected again as it was in July, Volkswagen could bypass the board by calling an extraordinary shareholder meeting (EGM) as early as October. This would be a rare move in Germany's corporate culture but may offer management a path forward given that Porsche SE holds 53.3% of voting shares and other shareholders collectively hold significant stakes. However, legal hurdles remain under the Volkswagen Law, which typically requires over 80% shareholder approval for major actions like spin-offs. Management could attempt to use Article 111 of Germany's Stock Corporation Act to lower this threshold at an EGM, potentially sparking a protracted dispute among stakeholders.
Topics: automotive labor_relations restructuring shareholder_meetings