Volkswagen, Europe's largest carmaker, is priming its employees for potential cuts, including personnel reductions. The brand's boss, Thomas Schäfer, warned 2,000 IG Metall shop stewards in Wolfsburg that "the situation is critical" and cuts are imminent, as reported by dpa from a VW intranet post.
Chief Human Resources Officer Gunnar Kilian proposed leveraging the demographic curve for maximum benefit through partial retirement and retirement arrangements, while acknowledging the unavoidable need for staff reductions. The ultimate goal is to remain a competitive, future-proof employer, as Group CEO Oliver Blume emphasized in a Frankfurter Allgemeine Zeitung interview.
Volkswagen's efficiency program, valued at billions for the core Volkswagen brand, aims to save €10 billion by 2026 and boost the brand's return on sales from 3.4% to 6.5%. The plan is subject to ongoing negotiations with the Works Council, which has explicitly ruled out dismissals for operational reasons before 2029 and is committed to preserving collective agreements.
A hiring freeze was implemented at key locations in November 2022, but more drastic measures are necessary, as Kilian conceded. The efficiency program is not just about personnel reductions; it encompasses a range of cost-saving measures and adjustments in technical capacity, productivity, and factory costs.
However, Volkswagen is not solely relying on workforce reductions. The company is also emphasizing its Scalable Systems Platform (SSP) as a key component of its future strategy, focusing on all-electric, digitalized, and highly scalable mechatronics platforms. This platform will be adopted across the Group, playing a significant role in the company's future success.
Moreover, Volkswagen is planning to introduce nine new electric models by 2027, including the production version of the ID.2all and an entry-level electric car priced around €20,000. These moves are part of Volkswagen's broader strategy to become the technologically leading volume manufacturer globally by 2030, as outlined in the "Zukunft Volkswagen" agreement.
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