Volkswagen mulls German job cuts and factory closures as sales plummet

DW (English)

Volkswagen's plans to cut jobs and close a plant in Germany have caused an outcry. The move is unprecedented in VW's 87-year history, but its CEO says this is necessary due to the "highly challenging situation."

Transcript

00:00Frustration and anger marked the start of a meeting, where Volkswagen management laid

00:06out its plans to scrap a job security agreement the company has had with its workers for 30

00:13years.

00:14The mood was very divided.

00:16There's a large division between the works council and the board.

00:19I've never seen it this bad.

00:21Whenever the works council speaks, they cheer, and when the board speaks, there's booing.

00:28People express themselves very clearly.

00:30They have fears about the future.

00:33The works council had some strong words to express what exactly the fears of the workers

00:37are.

00:38There are people here who are worried about being fired.

00:42The job guarantee was supposed to last until 2029, with the leader of the Volkswagen's

00:48workers council saying they're now gearing up for a fight.

00:55It's not just a matter of holding on to locations, whatever the cost, and then realizing in

01:00the next few years that this will catch up with us again.

01:03But we must also ensure that our company is profitable.

01:07And it has always been the case in the past that labor costs in Germany are higher than

01:11in any other country that we produce.

01:13This is nothing new.

01:19The automotive sector is the most important economic engine here in Germany.

01:23That's the message of works council head Daniela Cavallo at the meeting today.

01:28She says that if Volkswagen begins cutting back jobs, entire communities will feel it.

01:34CEO Oliver Blume has defended the move, explaining that the new competitors in Europe and a challenging

01:42economic environment are putting pressure on the company's finances.

01:48Volkswagen's share price has fallen by nearly a third in five years, increasing pressure

01:53on Blume to cut costs.

01:56With the growing threat of cheaper Chinese brands already eating into Volkswagen's market

02:01share, a strategic rethink is needed.

02:04They are losing sales.

02:06They are right now losing sales.

02:08And even for the electric cars they are producing in China, there is a very, very hot price

02:16competition going on, let's call it a price war.

02:19So Volkswagen needs to adjust on pricing here as well.

02:23That means losing money.

02:25Despite the risks to the company, workers here worry that a line has been crossed and

02:30that they could pay for the failure of management to keep up with competition abroad.

Category

Transcript

Be the first to comment

Recommended