VW’s €7.4bn Engine-Unit Sale Buys Breathing Room as Boardroom Showdown Looms Over Job Cuts

Volkswagen agrees €7.4bn sale of Everllence to Bain Capital, but the cash injection does little to calm protests over plans to cut up to 100,000 jobs and close four German plants.

Volkswagen is walking a tightrope between a blockbuster asset sale and a brewing labour crisis. The carmaker has agreed to sell a 51% stake in its heavy-duty engine subsidiary Everllence — the former MAN Energy Solutions — to private equity giant Bain Capital in a leveraged buyout valued at €7.4 billion. Yet the cash injection does little to calm the storm over plans to slash up to 100,000 jobs and shutter four German plants.

Bain will take control of Everllence, which employs roughly 16,000 people and posted last-year revenue of €4.9 billion building large motors for ships and power stations. Volkswagen will retain the remaining 49% for the medium term, steering the proceeds toward electric-vehicle development and software. The deal, expected to close by the end of 2026, includes ironclad guarantees for Everllence’s German sites in Augsburg, Oberhausen, Berlin, Hamburg and Ravensburg: no compulsory redundancies and no closures until at least the end of 2030. Approval from French employee representatives and other regulators still stands in the way.

That same week, however, more than 4,000 workers flooded the streets of Emden to protest against management’s sweeping cost-cutting plans. Four domestic factories are on the chopping block: Hannover, Emden, Zwickau and Neckarsulm. Volkswagen’s existing collective agreement with IG Metall already blocks compulsory layoffs in Germany through 2030 — any breach would trigger a €1bn penalty. The state of Lower Saxony, which holds 20% of voting rights and a veto on plant decisions, has sided squarely with the unions. A November 2024 Infratest dimap poll found 69% of Saxons wanted the regional government to block closures by political means if necessary.

The looming boardroom clash comes to a head on 9 July, when the supervisory board is scheduled to decide the final scale of the austerity programme. Worker representatives currently hold a majority of seats, and they have pledged fierce resistance. Behind the urgency lie brute numbers: Volkswagen can produce around 12 million vehicles a year but sells only about 9 million. Meanwhile, its crucial Chinese market is bleeding share to local rivals such as BYD.

The stock, which closed at €75.00 on Friday — a 2.6% gain on the day — still shows the depth of the distress. It has fallen 29.31% since January, touched a fresh 52-week low of €69.20 on 1 July, and trades more than 12% below its 50-day moving average of €85.44. The relative strength index sits at 35.8, in oversold territory. At the year’s high of €109.10, set last December, the shares are now 31% off.

Outside the assembly lines, Volkswagen has also been tearing up old playbooks. The partnership with Bosch on autonomous driving, which involved over 1,000 experts, has been scrapped; the carmaker will now buy the technology from external suppliers, only keeping one existing assistance system for its upcoming entry-level EV. And a perquisite-rich bonus system for executives is being phased out by 2027, replaced by a performance-based star-rating scheme designed to force a cultural shift at the top.

The €7.4bn from Bain Capital provides welcome liquidity, but it cannot resolve the fundamental overcapacity and power struggle that define Volkswagen’s present. All eyes now turn to 9 July, when the board must decide whether the cost discipline demanded by the market can be reconciled with the labour peace that the plant floor refuses to surrender.