Volkswagen executives defended their plans to consider unprecedented factory closures in Germany at a heated meeting with thousands of workers on Wednesday, saying falling sales were a major blow.
Fearing for their future, several thousand workers protested at VW’s historic headquarters ahead of the rally, waving banners and blowing whistles.
Volkswagen CFO Arno Antlitz said car sales in Europe were still well below pre-pandemic levels.
For Europe’s largest carmaker, this meant a loss of about 500,000 vehicles sold per year, “the equivalent of about two factories,” he said.
“The market is simply no longer there,” he told the meeting, which was attended by some 25,000 employees, some watching on screens outside.
“We need to increase productivity and reduce costs. We have a year, maybe two years, to turn the tide,” he added, without giving further details of the savings plan.
The Wolfsburg chief financial officer’s comments came two days after the shock announcement was first made to staff in an internal memo.
Volkswagen last year announced plans for a 10 billion euro ($11 billion) cost-cutting program and said it would cut its workforce in the coming years to improve profitability.
However, the group said further measures are now needed after recent results have been disappointing.
However, the decision to cut costs at one of Germany’s best-known companies has raised major concerns among government officials and led to Volkswagen clashing with unions and its powerful works council.
– ‘Fierce resistance’ –
Works council chairwoman Daniela Cavallo warned that VW management would face “fierce resistance from the workforce” and pledged no plants would be closed during her term.
The group “is not in trouble because of the German branches and the costs of the German staff”, but because “the management is not doing its job”, she said during the meeting.
“We are being dismantled in secret,” VW employee Axel Wenzlaff, 59, told AFP as he walked to the Wolfsburg plant, expressing concern about colleagues who might be affected.
“They have to start at the top and throw out those responsible,” Wenzlaff said.
The idea of possible factory closures in Germany and active cutbacks was “something completely new,” said Michael Gadow, 66, a former toolmaker at the group, where it is often thought that a job is for life.
“It is certainly concerning for many employees who otherwise feel they work in a very safe factory,” Gadow said of possible staff cuts at the group.
In Belgium, workers at the group’s factory in Brussels went on strike on Wednesday over threats to the future of the factory.
But closing a factory in Germany, where Volkswagen employs some 300,000 people across several brands, would be a first in the group’s 87-year history.
– ‘A car country’ –
The problems at Volkswagen, which is struggling with the transition to electric cars and competition from foreign rivals, are a major blow to the government of Chancellor Olaf Scholz at a time when the domestic economy was already struggling.
“Germany must remain a car country,” Labor Minister Hubertus Heil said Wednesday after a cabinet meeting in which ministers agreed to new support for electric cars.
He called on VW management to “ensure that a reasonable and socially acceptable solution is found and that VW remains strong”.
Scholz himself was monitoring the situation “closely,” his spokesman said at a press conference, adding that the group was responsible for finding a solution together with the employees.
“I still have Volkswagen blood running through my veins,” said 73-year-old retired car worker Eckard Siewertsen, one of three generations in his family to have worked for Volkswagen.
Despite a number of crises at Volkswagen over the years, “we have always managed to bounce back,” Siewertsen told AFP in Wolfsburg.
“I expect it will work this time too.”
lep-sr-sea/fz/cw