WOLFSBURG (dpa-AFX) - German auto major Volkswagen Group (VKW.L, VLKAF.PK, VOW.BE) said its restructuring plans are on track, including the proposed cut of 35,000 jobs in Germany by 2030, media reported citing a company executive.
Gunnar Kilian, Volkswagen's head of human relations and board member, reportedly told workers at a works council meeting that about 20,000 employees at the core of the Volkswagen brand have agreed to voluntarily leave the firm.
Further, the company plans to reduce the number of apprenticeships offered annually to 600 from 1,400, starting the year 2026. In addition, employees in Volkswagen's core team are accepting a payment freeze.
Volkswagen said the reductions will be carried out in an acceptable manner, with those affected agreeing to the terms.
The planned cost cutting actions would help the firm save nearly 1.5 billion euros every year in labour costs.
It was in December last year that Volkswagen and its union agreed on a socially responsible reduction in the workforce of more than 35,000 across the company's German sites by 2030. With the move, the company aimed to reduce labor costs by 1.5 billion euros per year, with a wage settlement agreement valid until 2030.
The joint agreement titled 'Zukunft Volkswagen' (Future Volkswagen) followed intensive negotiations with IG Metall and the Works Council.
In the short term, labor cost reductions and structural measures, including capacity reductions and decreased development costs, are expected to generate cost effects exceeding 4 billion euros per year, the company then said.
Additionally, Volkswagen's plan include reduction of capacity by 734,000 units across its German plants, providing the foundation for significant investments in future products through 2030.
The structural realignment at both operational and collective levels is designed to help Volkswagen Passenger Cars achieve its medium-term return-on-sales target.
The proposed job cuts and other initiatives are in line with the automaker's plan to restructure its German operations amid the ongoing volatile global economic situation.
In late April, Volkswagen reported that earnings after tax fell 40.6 percent in its first quarter, but sales grew 2.8 percent mainly due to higher vehicle sales in markets outside China. Unit sales growth in Europe and South America more than offset the slight decline in North America and the expected decline in China. The firm also backed its fiscal 2025 outlook for sales growth.
On the XETRA in Germany, Volkswagen shares were trading at 93.26 euros, down 0.26 percent.
Copyright(c) 2025 RTTNews.com. All Rights Reserved
Copyright RTT News/dpa-AFX
© 2025 AFX News
