Volkswagen eyes 100,000 job cuts, factory closures
What's the story
Volkswagen AG, the parent company of Porsche and Audi, is planning a major restructuring. According to Manager Magazin, CEO Oliver Blume has proposed plans to cut as many as 100,000 jobs and close several factories in a bid to make Europe's largest automaker more competitive. The company currently employs around 657,000 people globally.
Future discussions
Plans to be presented to the supervisory board next month
Blume's restructuring plans will be presented to the supervisory board next month. However, it is worth noting that these plans could be diluted as labor representatives make up half of the body. The strategy also includes cutting general overhead costs by €11 billion ($12.5 billion) by the end of this decade and closing four German factories in the medium term.
Closure details
VW plants under consideration for closure
The factories under consideration for closure include an Audi site in Neckarsulm and Volkswagen plants in Hanover, Zwickau, and Emden. Blume is also considering separating component plants and the VW brand to make the group leaner. This comes as part of a larger effort to tackle US tariffs, a weak Chinese market, and fierce competition from rivals such as BYD Co. and Stellantis NV in Europe.
Opposition response
Labor leaders warn of opposition
Labor leaders have opposed the new restructuring plans, saying they "unsettle our workforce and the regions where we operate." They warned that if such plans are pursued, they would oppose them with all their might. This is because pushing through job cuts at Volkswagen is difficult, as worker representatives occupy half the seats on the carmaker's supervisory board.