Volkswagen is enacting a broad restructuring of its European manufacturing operations,consolidating 22 plants under a new regionalized production system. The move, announced today, aims to streamline operations, reduce costs, and bolster collaboration between the Volkswagen, Skoda, and Seat/Cupra brands as the automotive industry navigates a period of rapid change and increased competition. The plan will begin rolling out in January 2026, with key changes including the creation of five new production regions and the appointment of regional production chiefs.
Volkswagen is restructuring its manufacturing operations to improve efficiency, a move that will impact its facilities in Germany and across Europe.
Wolfsburg – Volkswagen is reorganizing its 22 plants across the Volkswagen, Skoda, and Seat/Cupra brands into production regions, the company announced. The move aims to increase collaboration between plants across brands, reduce redundancies, and lower production costs. This restructuring comes as automakers globally seek greater efficiencies amid shifting market demands.
Specifically, Volkswagen plans to establish five production regions, with two located in North and South America. European operations will be consolidated into three production hubs. Germany will be part of a “Central Europe” hub alongside Poland, while the Czech Republic and Slovakia will form an “Eastern Europe” region. Spain and Portugal will comprise the third European region.
New VW Production Concept to Launch in 2026
The new structure will begin rolling out on the Iberian Peninsula in January of next year, with André Kleb taking on the newly created role of Chief Production Officer (CPO) for the region. Kleb will be responsible for organizing production at the two VW plants in Spain and Portugal, as well as the Seat plant in Martorell. Seat will eliminate the position of Production Director as part of the changes.
According to the company, the Region-CPO will oversee “cross-brand and cross-country functions such as central planning, product control, project and launch management, and logistics.” VW CEO Thomas Schäfer stated, “With our new, cross-brand control model, we will leverage further synergies and regional cost advantages.”
VW Production Concept Drives Further Centralization
The restructuring will require brand executives to relinquish some responsibilities in favor of a more centralized structure. Centralization often improves efficiency within companies, though past experience suggests that the best decisions within the Volkswagen Group don’t always originate in Wolfsburg, but rather from the leadership of individual brands.
Whether the production of the new model will benefit from the changes remains to be seen.
The Iberian Peninsula is critical to the company’s future, as it is slated to produce the more affordable electric small cars Volkswagen intends to use to compete in the automotive market. These include the ID.Polo, its Cupra Raval equivalent, and the SUV ID.Cross and Skoda Epiq. Volkswagen also plans to begin production of the ID.1 in Portugal in 2027, with a target price of €20,000.
Cross-brand collaboration was already underway during the development of these cars, as reported by Automobilwoche. (Sources: VW, Automobilwoche) (Leon Kaiser)
