Volkswagen Plans Factory Closures, Job Cuts

Volkswagen CEO Oliver Blume announced that the company is implementing a cost-cutting program to address longstanding structural problems exacerbated by weak demand in Europe and declining profits from China. The automaker plans to shut at least three factories in Germany, potentially affecting tens of thousands of jobs, and has requested a 10% wage cut from employees to enhance competitiveness. Blume emphasized that the high operational costs in Germany necessitate significant reductions, stating that the company must massively reduce costs to remain viable. Volkswagen has allocated around 900 million euros for these restructuring efforts. The situation highlights broader challenges within the European automotive industry, prompting other manufacturers to consider similar strategies. As companies navigate post-pandemic recovery, they are reassessing their operational frameworks to ensure financial sustainability.