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BMW Launches Voluntary Redundancy Programme as It Cuts 20% of Management Roles
BMW has begun a voluntary redundancy programme for indirect staff in Germany and will cut 20% of its senior vice president positions by mid-2027, as it redirects spending towards electric vehicles and the Neue Klasse.
By Edward Beaumont · 4 min read
BMW has launched a voluntary redundancy programme for indirect staff in Germany as the carmaker moves to reduce layers of management and cut costs while it funds a costly electric vehicle transition. The programme began this month and will run through 2027, with the company expecting the cost of the scheme to be recovered within about two years through savings from a smaller payroll.
The Munich-based group has not published a target for the number of departures, but a Reuters report from late July, citing a person familiar with the matter, suggested that as many as 8,000 jobs could go. BMW Group employed 154,540 people at the end of last year, so that figure would represent a reduction of roughly five per cent of the global workforce. The company has not confirmed that number.
Alongside the voluntary programme, BMW plans to reduce the number of divisions and associated senior vice president positions by 20 per cent by the middle of next year. Comparable reductions are planned at lower organisational levels, a sign that the company intends to remove several tiers of corporate bureaucracy rather than simply trim a handful of senior posts.
BMW has also said it will rely more heavily on artificial intelligence to speed up processes and improve efficiency. The aim is to automate more repetitive work, simplify the company’s structure and make decisions faster. The company has not said how many roles could be affected by automation, and the redundancy programme is being offered on a voluntary basis.
The timing reflects mounting pressure on BMW’s cost base. The group is spending heavily on the rollout of its Neue Klasse electric vehicle platform, on batteries, on electric vehicles and on new technology, while trading conditions in the global car market remain difficult. The challenge is most acute in China, the group’s largest market, where sales have been slipping for consecutive years. Cutting costs has therefore become a priority, and management roles are now part of that effort.
The cost-cutting extends to BMW’s model line-up. Several models will not be renewed for another generation. The only model officially confirmed for the axe so far is the 2 Series Active Tourer, although multiple reports suggest the i4 and iX will also be discontinued and the future of the XM looks uncertain. BMW has already phased out the X4, Z4 and 8 Series as it concentrates on models that generate more revenue.
Not every new model is being dropped. The imminent iX4 is unlikely to be a major seller, but its development costs are expected to have been relatively low because it is essentially an iX3 with a different rear half. The same logic applies to the already confirmed i3 Touring, which is effectively an i3 saloon in estate form.
BMW is also continuing to invest in electric performance models, including a planned electric i4 convertible, with an electric i4 coupe also expected. A more volume-oriented model will be a small entry-level electric car for Europe from 2028, while a high-margin flagship SUV for North America, possibly badged X9, is intended to support profitability.
The voluntary redundancy scheme and the management cuts are the clearest signal yet that BMW is prepared to shrink its overheads in Germany while it rebuilds its product range around electric vehicles. The company has not said whether further measures will follow, but the programme is designed to run for more than two years, giving it room to adjust the pace of departures as market conditions develop.
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