Volkswagen on austerity course: 20,000 waiver of jobs for the future!

Volkswagen on austerity course: 20,000 waiver of jobs for the future!

Deutschland - Volkswagen plans massive restructuring, which will include the dismantling of 35,000 jobs in Germany by 2030. These measures are part of a comprehensive renovation program that was agreed with the union in December. As Welt have already been contractually fixed, which more than half of the planned job removal make up.

The head of the HR Gunnar Kilian emphasized the progress in the factory costs and emphasized that the mining is socially acceptable. Operating dismissals are excluded and most exits are realized by early retirement regulations and severance payments. The "Future Volkswagen" agreement already shows initial successes, but there are challenges that the company has to deal with.

challenges and market conditions

Volkswagen faces a falling demand, especially in the markets in China and Europe. The brand financial board member David Powels pointed out the structural problems that the company burden. High investments in electromobility and high personnel costs affect the company's competitiveness, such as Tagesschau analyzed.

The pressure on Volkswagen is growing because the competition is increasing by Chinese and other foreign automobile manufacturers. The decline in the sales market in Asia is clear: In the second quarter of 2024, almost a fifth of fewer vehicles were exported to China. This situation is described as alarming by experts and shows that Volkswagen has not adequately promoted the transformation to electromobility and innovative digital systems.

effects on the workforce and the works

The planned job cuts are expected to have an impact on German production facilities. According to the VW works council, at least three works are on the brink, which could affect tens of thousands of positions. These announcements caused a major surprise in public, but experts had expected these developments, since Volkswagen had a 30-year employment guarantee expired last year. The company employs a total of 120,000 people in Germany, and possible cuts could endanger almost every twelfth workplace, with every third production facility being closed, such as Tagesschau

The group recorded a record turnover of around 332.3 billion euros in 2023, even if the expectations for 2024 had to be corrected downwards. The profit forecasts remained positive, but the health challenges of the market and the high salaries in Germany compared to other European countries increase the pressure on the austerity measures that are expected from corporate management.

Volkswagen boss Oliver Blume will take part in the upcoming industrial summit in the Federal Chancellery, where he hopefully will have constructive discussions to improve competitiveness and e-mobility. Chancellor Olaf Scholz also expressed that it was necessary to secure jobs, and the Federal Ministry of Economics has announced that it would take measures to promote electric vehicles. Nevertheless, it remains to be seen whether these steps are sufficient to cope with the challenges and to secure the future of the company.