The largest European car manufacturer is preparing for years that will not be easy at all.
The Volkswagen Group presented a plan according to which it wants to achieve more than six billion euros in annual savings by 2030, and a significant part of that plan relates to reducing the number of employees.
According to information confirmed by the company’s management, by the end of the decade, around 50,000 jobs should be cut within Volkswagen, Audi, Porsche and the software company Cariad.
Volkswagen itself should reduce the number of employees by around 35,000.
These measures are part of a wider strategy by which the German car giant wants to preserve profitability and maintain its leading position on the European car market.
Costs are rising, competition is getting stronger
Although Volkswagen continues to hold a leading position in Europe, the market situation is far from ideal. European car sales have not yet returned to pre-pandemic levels, and manufacturers are facing rising electric vehicle development costs and increasingly strong competition from China.
According to the company’s estimates, Volkswagen today produces about half a million fewer cars per year than before the pandemic, while Chinese manufacturers are gradually conquering a larger part of the European market. However, today almost every fourth newly registered passenger car in Europe comes from the Volkswagen Group.
In such circumstances, the company has set a goal of achieving an operating profit margin of between eight and ten percent by 2030, which it considers necessary to continue investing in new technologies and developing future models.
Electric cars remain a priority
At the same time, Volkswagen is not giving up on electrification.
Over the past year, the group has presented dozens of new models, and in the coming period, the arrival of new electric cars from Volkswagen, Cupra and Škoda is expected.
The company’s CEO, Oliver Blume, said that the coming years are crucial for the future of the group.
“The situation remains demanding, but we have strong brands, a clear strategy and quality products. We have great opportunities ahead of us,” said Blume, reports Klix.ba.
However, behind the optimistic messages there is a clear message to the market: even the largest European car manufacturer believes that without serious cuts and cost reductions, it will not be able to maintain its current position in the years to come.
