- Audi has announced plans to eliminate 7,500 jobs in Germany by 2029.
- The company also aims to reduce bureaucracy and lower personnel costs.
- The brand appears to be abandoning their EV-only push as headwinds mount.
Audi and their works council have reached an agreement that aims to reduce labor costs and increase flexibility at German production sites. The automaker also said they’re extending a “job protection plan until the end of 2033.”
The company didn’t go into many specifics, but noted economic conditions are becoming “increasingly tougher,” while they’re also forced to deal with “political uncertainties” and new competition. This is a perfect storm of bad news and it’s being complicated by slower than expected electric vehicle adoption.
More: VW Confirms More Than 35,000 Job Cuts In Germany, Golf Production Moving To Mexico
Unfortunately, this means cuts but they won’t be as deep as the ones at Volkswagen. However, Audi is still planning on a “socially responsible reduction” of up to 7,500 jobs by 2029.
Aside from eliminating employees, Audi aims to reduce bureaucracy and put a renewed focus on their product portfolio. The latter has become a problem as important models, such as the Q7, have grown stale.
Audi will also “reduce personnel costs by adjusting payments above the collective wage agreement and variable payments for pay-scale employees.” The automaker didn’t spell things out, but it sounds like managers and the Board of Management will be taking a pay cut. The automaker also mentioned a retooled profit sharing program to help “future-proof” the company.
As for the so-called job protection plan, Audi will invest around €8 ($8.7 / £6.7) billion into Germany through 2029. In Ingolstadt, this will pave the way for a new entry-level EV as well as production of the redesigned Q3, which will also be built in Győr, Hungary.
Audi was tight-lipped about plans for Neckarsulm, but hinted the “electronic architecture of combustion-engine vehicles will be developed further, significantly increasing their competitiveness.” The company also said they’re examining the possibility of building an “additional model” at the plant.
Rainer Schirmer, Vice Chairman of the General Works Council, said “We were able to future-proof both sites. For Neckarsulm, this means, among other things, that we were able to secure a ‘future fund’ for plant development, which we can use to set up new production platforms – for future electric models. To this end, Neckarsulm is to be expanded as an AI and digitalization center for the entire Audi Group.”
Audi CEO Gernot Döllner said the deal was a “strong agreement for the future of the company” and one that will strengthen their competitiveness. However, he noted “Audi must become faster, more agile, and more efficient” and this “cannot be done without personnel adjustments.”
Despite confirming the needs for cuts, Döllner said there would be “no layoffs due to operational reasons until the end of 2033. In these difficult economic times, this is good news for all employees.”
While Audi didn’t go into detail, Handelsblatt is reporting the company aims to save around €1 ($1.1 / £0.8) billion annually at their German sites. They also noted the Neckarsulm plant will build “large electric sedans,” while Ingolstadt could make the A3 – presumably in electric form judging by Audi’s statement.
Speaking of production, Audi has a Trump problem as they don’t have any plants in the United States. If the trade war worsens, the four-ring brand might set up shop at Volkswagen’s Chattanooga plant.
Audi also appears to have abandoned plans to go electric-only. This is a major change as, less than a year ago, they were adamant “we will transform our product portfolio and switch completely to electric vehicles. Our customers will experience the last major world premieres of new model lines with conventional drive systems in the course of 2026.” While the automaker didn’t exactly admit defeat, they acknowledged the continued development of ICE-powered vehicles.
