Volkswagen Shares Find a Floor as Analysts See Value, but 100,000 Job Cuts Cast a Long Shadow

Volkswagen’s preferred shares inched up to €76.56 on Tuesday, pulling away from the 52-week low of €69.20 set just days earlier. The modest bounce, however, does little to mask the severity of the crisis gripping Europe’s largest carmaker: year-to-date losses still stand at roughly 28%, and the stock remains more than 11% below its 50-day moving average.

Bankhaus Metzler sees this drawdown as a buying opportunity. The German bank reaffirmed its buy recommendation on VW and lifted its price target to €130, arguing that the aggressive cost-cutting programme and corporate overhaul now under way will ultimately safeguard profitability. Yet the road to that target looks treacherous, with a profit warning from the company widely expected ahead of Thursday’s supervisory board meeting.

UBS analyst Patrick Hummel has sounded the alarm, forecasting that Volkswagen will need to cut its full-year earnings guidance by a mid- to high-single-digit billion-euro figure — a hole that would severely strain an already fragile balance sheet. The board is bracing for a set of decisions that could reshape the company for decades, including the potential closure of four production sites and the elimination of up to 100,000 jobs worldwide, double the figure previously rumoured. At the premium subsidiary Porsche, around 4,000 positions in administration and development are also on the chopping block after operating profit collapsed from €5.6 billion to a fraction of that level.

The root cause of the crunch is Volkswagen’s deteriorating position in China, its most important market. A brutal price war and sluggish electric-vehicle sales are hammering margins so hard that even long-time VW dealers are now stocking rival brands to spread their risk. The board is weighing an unconventional response: building Chinese-market models at European plants such as Zwickau to take advantage of cost benefits and keep factories running. That plan has ignited a firestorm with the workforce.

Should investors sell immediately? Or is it worth buying Volkswagen?

On Friday, more than 4,000 employees demonstrated at the Emden plant. Now IG Metall has called a nationwide day of action for Thursday, timed to coincide with the supervisory board meeting. The union’s opposition is fierce, and the battle lines are hardening. The management’s ability to push through the restructuring against union resistance will also determine the dividend outlook. VW paid €5.26 per preferred share for the 2025 financial year, but analysts expect a cut for the current year — the final figure hangs entirely on the outcome of the boardroom negotiations.

Speculation has also swirled that Volkswagen’s depressed market capitalisation makes it a takeover target for Chinese rivals such as BYD, or even a breakup candidate. Moritz Schularick, president of the Kiel Institute for the World Economy, floated the scenario publicly, though the VW board has dismissed it as baseless. The relative strength index of 37.7 suggests the stock is oversold, but without a positive catalyst from the operational business, chart-based signals have lost their reliability lately. The volatility gauge has already spiked to nearly 32%.

All eyes now turn to Thursday’s board meeting. If the committee greenlights plant closures or confirms a steep profit warning, the shares could see violent swings. For now, the slight uptick from the lows offers a glimmer of hope — but against a backdrop that remains as dark as any in Volkswagen’s recent history.