Investing.com -- Volkswagen plans to eliminate its current bonus system beginning in 2027 as part of a broader restructuring effort at Europe's largest automaker, according to a report by Bild newspaper on Thursday.

The German car manufacturer will introduce a star-rating system to evaluate managers as part of the new compensation structure. The changes aim to shift the company's culture by placing greater emphasis on individual performance and impact.

Under the new system, managers will be assessed based on their contribution to the company's transformation efforts. The overhaul will also include a reorganization of career levels and the possibility of demotions.

The planned changes represent a move away from rewarding mediocrity, with the company seeking to make individual achievement a more central factor in variable compensation decisions.