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Volkswagen faces job cuts and possible factory closures as China sales slump
Volkswagen said its workforce of more than 650,000 employees is no longer sustainable, with up to 50,000 additional jobs at risk and multiple German factories threatened.
Yahoo Finance reports that Volkswagen Group chief executive Oliver Blume told staff last week that job cuts and potential factory closures are needed as the company confronts intensified pressure in Europe and a rapid shift in the auto market driven by China’s rise in electric vehicles.
The outlet says VW’s sales in China have fallen by more than one third over the past three months compared with the same period last year, while German automakers including BMW, Mercedes, and VW have struggled to find a bottom as their sales continue shrinking.
In a memo to employees, Blume linked the situation to broader economic and geopolitical stress on Germany, which is heavily exposed as an export nation, and he said the company’s challenges in automotive now appear more acute. He warned that Volkswagen’s 650,000-plus headcount is no longer sustainable and presented an employee choice between pay cuts across the board or layoffs affecting 50,000 workers, on top of a similar-sized reduction announced last year.
Yahoo Finance also notes that factories in Emden, Hanover, Zwickau, and Neckarsulm, which together produce about 750,000 cars a year, are facing closure risk, though Blume said he is still looking for “smart solutions” to keep the plants running.