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BERLIN\/FRANKFURT\/MEXICO CITY: Volkswagen\u2019s supervisory board on Thursday approved a transformation plan that will include cutting another 50,000 jobs in its attempt to counter painful tariffs, overcapacity and aggressive Chinese \u200brivals.<\/strong><\/p>\n The plan, the most extensive restructuring in Volkswagen\u2019s 89-year history, includes exploring alternatives for four German plants \u200bthat will eventually run out of models during the next decade.<\/p>\n It also averts a major \u2060clash with unions by putting the scenario of an extraordinary general meeting on the backburner, a scenario that was \u200bconsidered by management to push through its plans against workers and Volkswagen\u2019s second-largest shareholder, Lower Saxony. Frankfurt-listed \u200bVolkswagen shares closed 7.9% higher following the news, reflecting relief over what sources said could have escalated into an unprecedented crisis \u200cat \u2060Europe\u2019s largest automaker.<\/p>\n Industry analyst Ferdinand Dudenhoeffer said the next 10 months would see discussions over the future of Volkswagen\u2019s plants in Emden, Zwickau, Neckarsulm and Hannover, which all face a staggered phase-out from 2031 onwards.<\/p>\n The deal follows weeks of tense negotiations that pitted the board and majority owner Porsche SE (PSHG_p.DE), opens new tab against unions and Lower Saxony, with the idea \u200bof a spinoff of Volkswagen\u2019s \u200bpassenger car and components \u2060businesses no longer being mentioned.<\/p>\n \u201cA certain sense of calm is returning, but it is far from \u2018peace\u2019. In politics, one would call it a \u2018ceasefire\u2019. That\u2019s a good thing, because \u200bnow the focus can be on the business,\u201d Dudenhoeffer said. Volkswagen said \u201ca further fundamental adjustment of the global workforce capacity\u201d was needed, saying this would include a reduction \u2060of around \u200b50,000 positions worldwide \u2014 in addition to a 50,000-job reduction already under \u200bway.
The deal will result \u200bin a simplification of Volkswagen\u2019s conglomerate structure and limit the influence of the group\u2019s supervisory board \u2014 on which unions and Lower Saxony hold a majority \u2014 on key decisions.
\u201cThis is a strong signal for the future of the Volkswagen Group. We are taking responsibility \u200bfor our entire workforce, for our partners and for industrial jobs worldwide,\u201d CEO Oliver Blume said in a statement.<\/p>\n
The \u201cFuture Plan\u201d comes as Volkswagen faces \u200bpressure from all \u2060sides, squeezed between U.S. import tariffs and a weak Chinese market, the world\u2019s biggest car market and once the group\u2019s cash cow.<\/p>\n
The company did not provide further details on the timing of the workforce reduction or how the cuts would be distributed across its brands \u200band regions.<\/p>\n<\/div>\n