Volkswagen Will Shed Tens Of Thousands More Jobs. Its Stock Jumped.

Volkswagen announced it will shed tens of thousands more jobs as part of a massive restructuring plan. Stocks jumped more than 7% on the news at 8:31 a.m. ET.

The company said on Thursday that the supervisory board approved the Future Plan 2030, which will amount to its "most strategically profound transformation program."

The decision includes 50,000 more layoffs than those previously announced, taking the total to 100,000. The plan also involves shedding managerial roles.

"We are taking responsibility for our entire workforce, for our partners and for industrial jobs worldwide," company CEO Oliver Blume said following the decision. "Over the coming years, we will invest a three-figure billion sum to make our iconic brands even more attractive, stronger and more competitive."

He went on to address tariffs on vehicles from Europe have increased from 2.5% to 15%, making cars "more expensive and therefore increasingly difficult to sell – not because they have got worse, but because the rules of the game have changed."

Blume had also said previously that labor costs in Germany "are more than double those of comparable European locations."

"And when it comes to ​factory costs, other plants are still significantly cheaper. ​This is not a criticism, it is the reality against ‌which ⁠we must measure ourselves," he added.

Earlier in August, the company's controlling family shareholders had delivered their strongest public endorsement yet of a sweeping restructuring plan, urging management to move faster as Europe's largest automaker battles rising competition from Chinese manufacturers, higher tariff costs and weakening profitability.

The comments came from Porsche SE, Volkswagen's largest shareholder through the Porsche and Piëch families. Volkswagen has already confirmed it is evaluating plans to eliminate up to 100,000 jobs, double the number that had been previously discussed, as part of an effort to restore competitiveness after a sharp earnings decline.

"The Volkswagen Group is at a historic crossroads," Hans Dieter Pötsch, chairman of Porsche SE's management board, said in a statement. "The decisions that Volkswagen makes now will determine its future. For the sake of the company and its sustainable competitiveness, everyone must now step up and take responsibility," he added then.