The Volkswagen Automobile Group has agreed with the works council on a plan to cut jobs in Germany, which employs around 300,000 people. The company announced the agreement in its announcement today, but did not state the exact number of canceled places. According to AFP, up to 5,000 employees could leave by the end of 2023 due to the savings needed to finance the transition to electromobility. The German economic daily Handelsblatt previously reported on its website that the company was going to release so many people in the country.
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Volkswagen will offer early retirement or partial retirement to older employees born before 1964. The company needs to reduce fixed costs, the paper wrote. According to Handelsblatt, the head of the Herbert Diess Group considers the parent company in Wolfsburg and the corporate administration to be particularly inefficient. Volkswagen will therefore start an investigation in Germany, but other concern brands will follow.
With reference to company sources, the daily states that the company has set aside half a billion euros to compensate employees, ie about thirteen billion crowns. He hopes to save billions in the long run.
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Handelsblatt also wrote that Volkswagen would extend the recruitment ban until the end of the year. Originally, the measure was to apply only until the end of the first quarter. From the outside, the company will only be able to hire workers in areas such as information technology and software.
The Volkswagen Group, of which the Czech Škoda Auto is a part, said in January that it would reduce overhead costs by five percent and acquisition costs by seven percent in the next two years.
The company’s operating profit fell 45 percent to 10.6 billion euros last year, excluding extraordinary items. However, the carmaker stated that it expects a significant recovery in sales this year. In February, sales of both Škoda Auto and the entire Volkswagen Group increased year-on-year for the first time in five months.
