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Volkswagen to scrap current bonus system as part of overhaul, Bild newspaper reports - Finance news and analysis from Global Banking & Finance Review
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Volkswagen to scrap current bonus system as part of overhaul, Bild newspaper reports

Published by Global Banking & Finance Review

Posted on July 2, 2026

1 min read

· Last updated: July 2, 2026

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Finance Automotive corporate governance

Volkswagen to Scrap Current Bonus System Amid Corporate Overhaul by 2027

Volkswagen's Compensation Overhaul: Key Details and Implications

Background and Announcement

July 2 (Reuters) - Germany's Volkswagen will scrap its current bonus system from 2027 as part of an overhaul of Europe's largest car maker, the Bild newspaper reported on Thursday.

Details of the New Compensation System

Introduction of Star-Rating System

Starting in 2027, the group plans to radically overhaul variable compensation and evaluate managers using a star-rating system as part of a culture shift, Bild reported.

Expected Impact on Corporate Culture

Reporting and Editorial Credits

(Writing by Matthias Williams, Editing by Miranda Murray)

Key Takeaways

  • The current complex bonus and pay system will be replaced from 2027 by a new, transparent variable compensation model featuring star‑rating performance evaluations (volkswagen-group.com).
  • This move aligns with wider efforts by VW to cut costs (targeting up to 20% by end‑2028) and overhaul its corporate structure, including potential spin‑offs and significant job reductions (investing.com).
  • The change reflects a strategic shift toward greater competitiveness and cultural transformation amidst rising pressure from tariffs, weak demand, and intensifying competition from Chinese automakers (investing.com)

References

Frequently Asked Questions

What changes will Volkswagen make to its bonus system?
Volkswagen will scrap its current bonus system from 2027 and implement a star-rating evaluation for managers.
When will the new bonus system at Volkswagen be introduced?
The new system will take effect starting in 2027.
Why is Volkswagen overhauling its bonus system?
The changes are part of a culture shift and a wider overhaul of the company's management and compensation structures.
Who reported on Volkswagen's bonus system changes?
The changes were reported by Bild newspaper.
What is the main feature of Volkswagen’s new management evaluation system?
Managers will be evaluated using a star-rating system.

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