It has been reported that German automotive manufacturer Volkswagen (VW) may lay off approximately 50 thousand more people worldwide in order to make its costs competitive.
According to the news in the German press, Volkswagen Chief Executive Officer (CEO) Oliver Blume sent an internal memo to employees.
The note noted that the company's costs in administrative, infrastructure and support units are approximately 20 percent above the average of similar automobile manufacturers.
In the note, it was stated that if no change was made in labor costs, additional employment reduction would be required to close this difference, and it was stated that which regulations were necessary and applicable in all brands, companies and regions were evaluated, and the final decision was not yet made.
"Since personnel expenses account for half of overhead costs, a theoretical calculation assuming no change in labor costs would mean a reduction of approximately 50 thousand positions worldwide," the memo said. evaluation was made.
The note reminded that Volkswagen could reduce its production capacity in Europe by 500 thousand vehicles in order to adapt to the decreasing demand, and stated that the group could terminate production in 4 factories in Germany.
In the note, it was reminded that despite better products, there were difficulties in competing with models from China in terms of cost and price.
Volkswagen Group had previously announced a plan to reduce employment by approximately 50 thousand people across its various brands, including Audi and Porsche, by 2030.
If the possible new downsizing is implemented, the total number of layoffs will reach 100 thousand.