VW could cut up to 30,000 jobs in Germany, report says

Volkswagen Group could cut up to 30,000 jobs in Germany, a business magazine said, as the automaker seeks to become more competitive amid Europe's shrinking market.

VW Group CEO Oliver Blume considers reducing the company's German workforce by 30,000, about 10 percent of its total employees in the country, as realistic in the midterm, Manager Magazin said.

The cuts would be deepest in the automaker's research and development activities where 4,000 to 6,000 jobs would be lost from the 13,000 R&D employees in Germany, the report said.

VW Group finance chief Arno Antlitz wants to reduce investments over the next five years to €160 billion from €170 billion, according to the magazine.

VW said this month it needed to cut costs significantly at its namesake brand in Germany, citing high costs, low productivity and fierce competition. The automaker said it is scrapping labor agreements that guarantee jobs until 2029 at six German plants, raising the prospect of factory closures and compulsory layoffs.

Demand in Europe has not recovered since the pandemic and the company has lost sales of "500,000 cars, the equivalent of around two plants," Antlitz told an employees at the automaker's headquarters in Wolfsburg on Sept. 4.

Antlitz said he did not expect sales to recover and that the VW brand must cut spending and adjust its output to survive the shift to electric cars.

VW Group is struggling with high costs in its core VW passenger cars brand where it wants to lift margins to 6.5 percent by 2026. The brand's margin fell to 2.3 percent during the first half.

VW's works council said the 30,000 number "has no basis whatsoever and is simply nonsense."

A VW spokesperson  told the dpa news agency that the automaker must reduce its costs at its German sites so the VW brand can earn enough money to invest in the future.  "How we achieve this goal together with the employee representatives is part of upcoming talks," the spokesperson added.

The spokesperson declined to comment on the job losses figure.

Former VW Group CEO Herbert Diess warned in 2021 that 30,000 jobs at the automaker in Germany could be at risk amid the industry's shift to electrification. The warning damaged Diess's relations with VW unions and was one of the factors that cost him his job.

Automobilwoche contributed to this report