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Volkswagen CEO defends job cuts citing economic pressures
2024-09-09 13:29:08
Automotive
Business

Volkswagen CEO defends job cuts citing economic pressures

Image courtesy of : AFP (MORITZ FRANKENBERG)

Volkswagen's CEO is defending the company's decision to implement €4 billion in cuts in order to save jobs, citing economic pressures. However, worker representatives have warned of wider impacts, while the Left Party is demanding a dividend repayment.

Chancellor Scholz is aiming to secure jobs amidst the financial challenges faced by the company. The Federation has criticized Volkswagen for its unreliable infrastructure.

The company has also faced a decline in its share price and a decrease in car sales in Europe. Additionally, Volkswagen is now facing new competition from Asian competitors.

These challenges have led to the first factory closures in the company's nearly 90-year history.

Related news on that topic:

'The reason for this crisis is the absurd European policy': ... EU for Volkswagen

The European Union (EU) needs to develop an industrial strategy to enhance European competitiveness, and politicians are urging for more assistance for Volkswagen (VW) due to the detrimental EU policies hindering the automaker. VW CEO, Blume, cites the challenging situation and declining competitiveness as reasons for the planned cost-cutting program. Critics blame VW's delayed and inadequate investment in electric mobility for the company's lag in China. To fight against the proposed cutbacks, VW works council chairwoman, Cavallo, will participate in the SPD presidency meeting. The FDP is advocating for technology neutrality to support companies like VW. EU regulations result in excessive bureaucracy but do not contribute to CO2 reduction. The crisis in the automotive industry has raised concerns in the EU, with the outgoing Commissioner for Industry, Breton, highlighting the closure of VW factories and the need for improved charging infrastructure as the main issues. Political figures such as SPD leader Klingbeil and FDP parliamentary group leader Dürr are calling for an ambitious industrial strategy from EU Commission President von der Leyen to strengthen European competitiveness. Dürr also criticizes the 'absurd' European fleet regulation as the cause of the crisis. The EU Commission is alarmed by the automotive industry's crisis, with concerns over VW's cost-cutting measures and factory closures. The transition to electric mobility presents challenges due to inadequate charging infrastructure in Europe. High-ranking politicians from the Ampel coalition are demanding more help from Brussels. Gabor Steingart's guest contribution raises concerns about state subsidies for companies like VW, calling them 'citizen money for the upper class'. He also highlights the need for government support for electric vehicles and heat pumps due to the immaturity of the market. Expert Dudenhöffer criticizes the discontinuation of the electric vehicle subsidy and the persistence of combustion engine vehicles, blaming Berlin and Brussels for harmful policies. Dudenhöffer warns that China leads in electric vehicle adoption and Europe cannot offer the auto industry of the future. The potential closure of VW factories in Germany due to competition from China, energy costs in Russia, and global trade shifts raises concerns about the exposure of German carmakers to China and the changing geopolitical landscape.

Klingbeil and Dürr call for more EU aid due to the VW crisis

Amidst the crisis at Volkswagen, high-ranking politicians from the Ampel coalition are calling for more assistance from Brussels. SPD leader Lars Klingbeil urges EU Commission President Ursula von der Leyen to quickly present an ambitious industrial strategy that strengthens Europe's competitiveness on the global stage. FDP faction leader Christian Dürr also sees the EU Commission as responsible, blaming European policies for hindering automakers. Dürr emphasizes the need to abolish fleet regulations, which he believes are burdensome and have no impact on reducing CO2 emissions. Both Klingbeil and Dürr emphasize the importance of technological openness in supporting companies like VW. The core VW brand recently announced tougher cost-cutting measures, including potential plant closures and layoffs, citing a challenging European auto market and decreased competitiveness of German production sites. Critics argue that VW's insufficient investment in electric mobility has caused it to fall behind its competitors in key markets like China. VW-Betriebsratschefin Daniela Cavallo will join the SPD executive committee remotely to voice her opposition to VW's downsizing plans. Both Klingbeil and Dürr are calling for EU assistance, with Klingbeil specifically urging von der Leyen to take the lead in ensuring Europe remains competitive in international developments.

Read 24 more recent news on this topic

The press radar on this topic:

Deutsche Welle
8. September 2024 um 14:43

Volkswagen CEO defends job cuts citing economic pressures

Economy
Politics
Volkswagen CEO defends €4 billion in cuts to save jobs, citing economic pressures; worker reps warn of wider impact; Left Party demands dividend repayment; Chancellor Scholz aims to secure jobs; Federation slams 'unreliable infrastructure'; Volkswagen's share price has fallen, fewer cars sold in Europe; VW faces new competitors from Asia, first factory closures in nearly 90-year history.
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9. September 2024 um 11:37

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Volkswagen replaces the CFO of the core brand VW passenger cars; Seat manager David Powels takes over; Group faces difficulties, announces cost-cutting measures.
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9. September 2024 um 11:37

VW Core Brand Replaces Finance Chief - Seat Manager Takes Over

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VW core brand replaces finance chief; Seat manager David Powels takes over the position; previous finance chief Patrik Andreas Mayer moves to Seat.
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9. September 2024 um 11:38

VW core brand replaces CFO - Seat manager joins

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VW core brand replaces CFO Patrik Andreas Mayer with Seat manager David Powels; Mayer has been CFO since October 2022; VW plans cost-cutting program with job cuts; VW intends to terminate job security, German plants are under review, layoffs are impending; Mayer wanted to tap into the innovation fund, works council and IG Metall announce significant resistance; VW core brand is considered chronically unprofitable.
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