Volkswagen Group has warned that it may close factories in Germany and implement forced layoffs as it struggles to me its €10 billion ($11.14 billion) cost-cutting target to lift weak profitability at its core VW brand.
VW considers one large vehicle plant and one component factory in Germany to be obsolete, according to the automaker's works council.
Any shutdowns would mark the first VW plant closures in Germany during the company’s 87-year history, setting VW up for a clash with unions. The IG Metall union promised "fierce resistance" to the plans.
The IG Metall union says the following German factories could be affected by the cost-cutting drive. All are in the northwestern state of Lower Saxony, apart from the Kassel plant which is in Hesse in central Germany.
Brunswick
VW's oldest plant employed about 7,400 workers as of 2022. It produces components such as front and rear axles, steering and battery systems as well as machinery, equipment, tools and molds. It has also been making batteries for VW's new modular electric drive matrix MEB vehicles since 2019.
Emden
Founded in 1964 to take advantage of its nearby seaport, the plant initially specialized in producing the VW Beetle. The factory now builds models such as the VW Passat and the VW electric ID4. More than 8,000 employees work at the factory, which produces around 180,000 vehicles a year.
Hanover
The factory employs around 14,000 people in Lower Saxony, a region of 8 million which is also VW's second largest shareholder. It is where production of the VW 'Bulli' began in 1956 and now produces the sixth-generation T-Series vans and minivans, as well as the Amarok pickup. Apart from vehicles, it also makes parts such as cylinder heads and inlet manifolds.
Kassel
Part of the VW Group since 1958, the Kassel plant is VW's biggest components plant worldwide and produces more than four million manual and automatic transmissions a year. The plant is the largest employer in northern Hesse, VW says, employing around 16,500 people. The components produced in Kassel are used in the core VW brand, as well as in VW Commercial Vehicles, Seat, Audi, Skoda, Porsche and Lamborghini vehicles.
Salzgitter
Opened in 1970 for the production of VW's K70 sedan, the Salzgitter factory employed around 7,500 workers as of 2023. It now manufactures engine variants as well as components for electric vehicles. VW announced a 2-billion-euro ($2.21 billion) investment in 2021 to transform the main engine plant into the main battery cell plant for the group.
Wolfsburg
The vast plant in Wolfsburg, Lower Saxony is at the heart of the group's production and is VW's headquarters. VW says the plant, which covers an area around the same size as 910 soccer pitches, employs approximately 70,000 people. Established in 1938, shortly after the company was founded under the Nazis, it produced nearly half a million vehicles in 2023, including the VW Golf.
