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Volkswagen board approves cutting 50,000 more jobs and ending production at 4 plants
abcnews.com • • general
Key Points:
- Volkswagen's board approved a major cost-cutting plan to eliminate 50,000 jobs, reduce its model lineup by half, and cease auto production at four German plants to address competition and tariff challenges.
- The plan, proposed by CEO Oliver Blume, aims to increase model volumes and lower fixed costs by slimming the model range and streamlining leadership and decision-making structures.
- Production cuts will affect plants in Emden, Zwickau, Hanover, and Neckarsulm, with alternative uses for these sites to be explored amid excess European production capacity.
- Employee representatives and the Lower Saxony regional government, both holding board seats, initially resisted but ultimately supported the plan as necessary for Volkswagen's future competitiveness.
- Volkswagen faces significant financial pressure, reporting a 30% drop in after-tax earnings in H1 2023 due to declining sales in China, impacting its various brands including Audi, Porsche, and Skoda.
