Volkswagen CEO: "The situation is more than critical"
CEO Oliver Blume says existing cost cuts are insufficient and a new package — possibly including about 50,000 job losses — should be ready by the end of the year.
Volkswagen's chief executive, Oliver Blume, warned that the carmaker is facing a tense and deteriorating situation and that the measures taken so far are not enough to secure its long‑term competitiveness.
Blume told the company intranet that current results still leave the group exposed: the company’s operating margin of 3.8% is “solid”, he said, but it is not enough "to generate sufficient funds in the long term for new technologies, new products and production capacities."
New package of measures and the scale of job cuts under consideration
According to Blume, urgent action is required and management is preparing a new package of cost measures intended to be adopted by the end of the year. He added that earlier efforts are falling short: "The measures so far to reduce costs by 20% are not sufficient."
Blume warned that the company may have to cut about 50,000 jobs to restore competitiveness, a figure that has already provoked anger among employees and trade unions. The prospect of such large-scale reductions has prompted unions to demand immediate talks with management.
Workers and union representatives have announced planned protests and will press for meetings to discuss Volkswagen’s long-term plans and the timetable for any redundancies. Management says the measures are intended to stabilise the business and free resources for investment in electrification and new models.
Blume’s remarks underline the scale of the challenge facing the largest carmaker in Europe as it seeks to rebalance costs while financing a transition to new technologies and products.
Photo: press material from the event
