Volkswagen may need to eliminate about 50,000 additional jobs to match the competitiveness of its rivals, its CEO told employees in an internal memo, effectively confirming for the first time that the carmaker is considering cuts of up to 100,000 positions.
Oliver Blume is battling to streamline Europe's biggest carmaker, whose profits have slumped as its faces billions of euros in tariff costs, stiff competition in China and pressure on its German manufacturing network to become more efficient.
After already agreeing 50,000 job cuts across the group, including its Porsche and Audi subsidiaries, the company must work on reducing costs further, having calculated a cost disadvantage versus comparable companies of 20%, Blume said in the memo seen by Reuters.
This means a "theoretical deduction" of another 50,000 jobs worldwide, the memo said.
"We are currently assessing across all brands, companies and regions how many adjustments are actually necessary and feasible," Blume said in the document.
Staff costs are determined not only by the number of employees but also by labor costs, he added. "We must also pull this lever," he said, indicating that the exact scale of the job cuts has not yet been finalized.
The company had previously declined to comment on reports it was considering up to 100,000 job losses.
The memo follows angry calls from workers for management to explain its restructuring plans, which Blume presented to the company's supervisory board on Thursday.
Nationwide protests were held by trade union IG Metall on Thursday, while the company's works council also outlined its fury over the weekend.
Sources familiar with the matter said labor representatives on the committee blocked the proposals, which were said to include job cuts and the possible closure of four factories.
"As of today, we still cannot confirm competitive use cases for the plants of Emden, Hanover, Zwickau and Neckarsulm in the 2030s," Blume said in the memo.
He said he preferred "intelligent solutions" to closures, having previously pointed to the defense industry or the production of Chinese Volkswagen models in Europe as options for underutilized factories.
