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- Volkswagen Future Plan Approved | 50000 Jobs Cut & Union Conflict Resolved
Berlin/New Delhi38 minutes ago
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Europe’s largest car company Volkswagen has approved a new plan to reduce its expenses and improve its business.
Under this, 50,000 more employees will be laid off across the world. This cut will be in addition to the 50,000 jobs already being eliminated.
After this big announcement, Volkswagen’s shares registered a strong rise of 7.9% on the Frankfurt Stock Exchange, which gave investors relief from a potentially unprecedented crisis.
Agreement reached between unions and government
This agreement averts a major dispute between Volkswagen management with its employee unions and the second-largest shareholder ‘Lower Saxony’ state government.
Earlier, despite opposition, the management was preparing to call an emergency meeting to forcefully implement this plan.
The structure of the company will be simple, the interference of the board will reduce. The new decision will make Volkswagen’s operations easier and reduce the board’s interference in major decisions, which was currently dominated by unions and the government.
Apart from this, the old plan of making the passenger car and parts business a separate company has also now been cancelled.
CEO Oliver said – this is a strong sign for the future
Company CEO Oliver Blume said in a statement that this is a strong signal for the future of Volkswagen Group. We are taking responsibility for our entire workforce, our partners and industry jobs around the world. The company management has got the right to restructure its huge network through this agreement.
Why are 50,000 more jobs being eliminated?
The company says that due to continuous losses it became necessary to reduce the number of employees.
Volkswagen is facing difficulties in two big countries – import tariffs are being imposed on vehicles in the US and sales have declined significantly in the Chinese market, which was once the company’s main source of income.
However, information about when these new layoffs will take place and how many people will be removed from which country or department has not been given yet.
Future of German plants: Next 10 months very important
According to auto expert Ferdinand Dudenhofer, the next 10 months will be very critical, as Volkswagen will decide on the future of its four major plants in Germany, Emden, Zwickau, Neckarsulm and Hanover.
- Models may be discontinued from 2031: There is a plan to gradually stop the production of vehicles in these factories from 2031 onwards, due to which the employment of the employees working there is in danger.
- Expert Comments: Dudenhofer said that this decision is not complete peace but a kind of ‘ceasefire’. This is a good thing, because now the company will be able to focus its full attention back on managing the business.
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