BMW plans to cut about 8,000 jobs by the end of 2027 through a voluntary redundancy programme. The German premium carmaker wants to lower costs as US tariffs, shrinking margins and fierce Chinese competition pressure earnings.
A company source told AFP that BMW would offer voluntary exit packages to around 40,000 of its roughly 85,000 permanent German employees from October. The programme will target desk-based roles, including administration and development. Production-line workers will remain exempt.
“The workforce will ultimately be reduced by around 8,000 people by the end of 2027,” the source said. “We’re planning on the basis of that.”
Voluntary exits to focus on German offices
BMW employs about 154,000 people worldwide. Its management and works council negotiated the redundancy plan for around six weeks, according to the source.
Most departures will come next year. BMW expects the programme to deliver meaningful cost savings from 2028. However, restructuring expenses could reach hundreds of millions of euros during the second half of 2026. The final bill will depend on how many employees accept the offer.
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BMW confirmed that it had agreed on a voluntary programme with employee representatives. The plan covers administrative and development divisions but excludes production operations. It will run from October 2026 until the end of 2027.
China slump squeezes BMW margins
BMW issued a surprise profit warning in June after business conditions in China deteriorated faster than expected. The company now expects its automotive operating margin to fall between 1% and 3% in 2026. It had previously forecast a range of 4% to 6%.
BMW reported on Thursday that second-quarter pre-tax profit fell by more than one-third to 1.7 billion euros. Its automotive operating margin dropped to 2.3% from 5.4% a year earlier.
Vehicle deliveries in China fell 30.2% year-on-year during the three months to June. BMW’s annual deliveries in the country had already fallen to their lowest level since 2017 last year.
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BMW has continued offering petrol, diesel, hybrid and electric models instead of making an abrupt battery-only shift. This strategy helped it avoid some costly changes faced by rivals. Meanwhile, its global electric vehicle deliveries increased during the second quarter.
German auto sector faces ‘immense’ pressure
BMW’s plan adds to a broader restructuring wave across Germany’s automotive industry. Volkswagen is weighing up to 100,000 cuts across its brands, while Mercedes-Benz operates its own voluntary redundancy programme.
German industrial companies cut about 124,000 jobs in 2025, according to consultancy EY. The automotive industry accounted for roughly 50,000 of those losses.
Carmakers have also expanded production in lower-cost European locations. BMW opened its Debrecen plant in Hungary in September 2025. Mercedes-Benz recently more than doubled its Kecskemet facility, making it the company’s largest European production site.
“The whole sector could benefit from improved productivity, no two ways about it,” Mercedes-Benz CEO Ola Kaellenius said. “The pressure is immense.”
