Volkswagen CEO, Thomas Schaefer, stated on Saturday that the automaker has no choice but to implement job cuts and plant closures in order to achieve €4 billion in cost reductions.
In an interview with Welt am Sonntag, Schaefer emphasized that the company must find comprehensive solutions to address its challenges. “Any solution must reduce both overcapacity and costs. We cannot apply a temporary fix and continue as is, as it would eventually have serious repercussions,” he said, according to Reuters.
These remarks come amid an intensifying dispute with workers, which is expected to worsen the situation. Workers have threatened to strike in December and are urging the company to find solutions that avoid factory closures and major job cuts, particularly in ongoing negotiations regarding pay and capacity.
Schaefer noted that most of the layoffs could be managed through normal attrition and early retirement, but stressed that this alone would not be enough to resolve the issue. The company has not yet disclosed specific details on the expected job cuts.
Regarding the timeline, Schaefer suggested that the restructuring should be finalized within 3-4 years, adding, “Postponing restructuring until 2035 would be too late. By then, our competitors would have surpassed us.”
In addition to workforce reductions, Volkswagen has requested a 10% wage cut from workers at its VW AG unit, which is at the heart of the current conflict. Schaefer also expressed concerns over the lack of demand recovery in Europe, pointing out that labor costs at the company’s German sites are nearly double those at its plants in southern and eastern Europe.