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Volkswagen to shut three factories, axe jobs and cut pay by 10%, says union (www.theguardian.com)

submitted 2 weeks ago by [email protected] to c/[email protected]

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German carmaker warns of stagnation in the European sector amid news of deeper-than-expected action

The German carmaker Volkswagen is planning to shut at least three factories in its home country, lay off thousands of workers and cut pay by 10%, according to the company’s union.

The deeper-than-expected cuts come as the company faces weak sales and slow expansion in the electric vehicle (EV) sector amid tough competition from Chinese manufacturers.

“The board wants to close at least three factories in Germany,” the works council chief, Daniela Cavallo, told employees at VW’s headquarters in Wolfsburg on Monday. Its remaining manufacturing sites will reduce capacity, she said, citing information provided by management.

As Europe’s top economy suffers a crisis in manufacturing and fears of mass unemployment, VW is aiming for a fundamental restructuring to cut costs. It had initially warned last month that it had the equivalent of two factories of extra capacity in Germany.

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[–] [email protected] 70 points 2 weeks ago (16 children)

Some context from someone who lives in germany:

VW has for quite a while now failed to read the writing on the wall and join in on the growing market for electronic cars. All the while getting subsidies from the german government.

Now they cant compete anymore and even their regular cars are way to expensive for a lot of germans to buy. And the chinese manufacturers are pushing them even further out of a market they failed to enter by refusing to innovate years ago.

A lot of this reads over here like hostage taking: They want more subsidies for their failing company model, or they leave the country.

[–] [email protected] 3 points 2 weeks ago

I remember reading somewhere that they have a subsidiary that was made to implement the software needed to run EVs, and another something to do with batteries. Both of these subsidiaries have appeared to be massive failures, though the reasons weren’t stated in the article I read. Were they just badly funded? Or were the people hired there resistant to switching to EVs?

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