- The automaker is also looking at capping bonuses to top-tier employees.
- VW is also said to be thinking about slashing as many as 30,000 jobs across its network.
- The VW passenger car brand needs to save €10 billion ($11 billion) by 2026.
Volkswagen is looking for ways to save €4 billion ($4.3 billion) and this could include significant wage cuts for employees, as well as other measures. At a time when inflation is high and cost-of-living pressures are rising, this is bad news for employees.
German newspaper Handelsblatt says the carmaking giant is looking for ways to cut expenses. Leadership at VW is said to be considering a 10% wage cut for some employees while also capping bonuses for top-tier employees, reducing additional payments for employee anniversaries, and potentially closing production sites in Germany. Plans to close local factories have already generated a huge amount of controversy.
Read: VW Ditches Decades-Old Job Protections In Germany, Sets Stage For 2025 Layoffs
Reuters understands that since early October, VW management has been speaking with worker representatives from its plants in Germany and looking for ways to cut costs and deciding which vehicles should be produced at each plant. The next round of wage negotiations is scheduled to begin on October 30.
In September, reports indicated that VW was considering cutting as many as 30,000 jobs. As many as 4,000 to 6,000 of the employees at risk work within the brand’s research and development department, and if they’re axed, VW’s R&D team will almost be slashed by half.
In the second week of September, VW also scrapped several labor agreements at six German plants that had guaranteed jobs until 2029. These three-decade-old agreements had safeguarded employment until 2029 but will now only run until the middle of next year. The marque says the VW passenger car brand needs to save €10 billion ($11 billion) by 2026.
If a new employee agreement can’t be reached by June 2025, agreements established before 1994 will come into effect. These agreements will provide pay rises at all six German plants and also include a Christmas bonus, extra holiday pay, and higher overtime bonuses. The caveat is that VW will have the ability to force redundancies.
