Volkswagen to cut jobs in struggling VW brand
Volkswagen's brand chief, Thomas Schaefer, cautioned that the company's high costs and low productivity are making its vehicles less competitive. As a result, Volkswagen plans to cut its workforce as part of a €10 billion (Rs. 91,243 crore) savings program. Schaefer told employees at the carmaker's headquarters in Wolfsburg, "With many of our pre-existing structures, processes and high costs, we are no longer competitive as the Volkswagen brand," as reported by Reuters.
Workforce reduction through partial or early retirement
Gunnar Kilian, the human resources board member, explained that the workforce reduction would be achieved through partial or early retirement agreements. This aligns with Volkswagen's previous commitment to avoid dismissals until 2029. However, Kilian added that most of the €10 billion savings target would be reached through measures other than personnel reduction, with full details to be determined by year's end.
Eliminating duplication and unnecessary processes
Kilian also stressed the importance of Volkswagen being courageous and honest in eliminating duplicated processes and unnecessary weight within the company. "We need to finally be brave and honest enough to throw things overboard that are being duplicated within the company or are simply ballast we don't need for good results," he said. This is part of Volkswagen's group-wide effort to increase efficiency during the transition to electric cars and enhance overall competitiveness.
