BERLIN -- Volkswagen Group CEO Herbert Diess warned of more output cuts because of the chip crisis at its main factory in Wolfsburg amid rising tensions over how to make the plant fit for the electric age.
While VW has made progress managing the global components bottleneck, the situation at its German headquarters in Wolfsburg remains challenging, Diess said on Wednesday during a workers' assembly.
"Wolfsburg is particularly hard hit by the semiconductor situation," Diess said. "Capacity adjustments are therefore necessary, also in the medium term."
He added: "The supply situation is improving, but even in 2022 we will not be able to build all the cars we could sell. But we see opportunities for further production increases, particularly in the second half."
Diess said VW has introduced an early warning system for potential shortages and the company's software developers have already put 150 technical alternatives into the cars to replace missing chips.
Top models of VW Group's Porsche, Audi, Bentley and Lamborghini brands are already sold out for all of 2022, and its truck businesses also seeing well-filled order books, he said.
The Wolfsburg plant is expected to produce about 570,000 vehicles this year, works council head Daniela Cavallo said.
Last year, output plummeted by 330,000 vehicles, in part because the group favored production of higher-priced models at other locations, with just under 400,000 vehicles rolling off the production line.
“Those were your choices, that’s your responsibility,” Cavallo said in comments addressed to top management. “That’s why you owe your colleagues compensation.”
Cavallo called for staff to be compensated for planned cuts to night shifts, a move that is expected to reduce the pay of some 5,000 workers.
Talks over how to keep Wolfsburg competitive in the shift to battery-powered cars has seen tensions rise between Diess and union leaders.
Diess last year hinted at possible job cuts to keep pace with Tesla as the electric car leader plans to ramp up output at its first European factory near Berlin this year.