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Volkswagen is about to shed one in seven of its workers.
The German car giant said on Thursday that management and unions had agreed to cut a further 50,000 jobs by the end of the decade, on top of 50,000 already planned, bringing total losses to 100,000.
“It is essential to systematically align workforce levels with economic realities,” the 10-brand group said in a statement.
The firm had approved a plan involving “the reduction of around 50,000 jobs” on top of another 50,000 already agreed, it added.
Hit by US tariffs, patchy demand for electric cars and, above all, fierce competition in and from China, Europe’s largest carmaker is in trouble.
The group, which apart from its namesake brand also includes Audi and Porsche, had already agreed to cut about 50,000 jobs worldwide.
The total 100,000 cuts will be the largest restructuring ever carried out in the global automotive industry, amounting to about 15% of the carmaker’s staff worldwide.
The cuts eclipse the auto industry’s previous record-holders. General Motors cut 74,000 jobs and closed 21 plants in 1991 as it lost ground to Japanese rivals, and cut a further 47,000 jobs globally in 2009 during its financial crisis restructuring.
Ford cut 35,000 jobs and closed five plants in 2002, then targeted tens of thousands more under its “Way Forward” plan later that decade. Volkswagen’s 100,000 is now the largest total on record.
Volkswagen further said that management and unions agreed the future of four German plants — in Hannover, Emden, Zwickau and Neckarsulm — could not be assured into the 2030s.
Their closure would mark the first time Volkswagen has shuttered full-scale factories in its home country.
The adoption of the plans by Volkswagen’s supervisory board, made up of both labour and shareholder representatives, marks progress in delicate negotiations between the two sides.
“The supervisory board has unanimously approved the executive board’s future plan presented today,” CEO Oliver Blume said. “This is a strong signal for the future of the Volkswagen Group.”
Alongside its namesake marque, the group’s stable spans Škoda, SEAT and Cupra at the mass-market end, Audi, Bentley, Lamborghini and Ducati at the premium and luxury end, and Porsche as a standalone sports brand.
Additional sources • AFP