VW to cut up to 4,000 jobs through early retirement, sources say

FILE PHOTO: A Volkswagen logo is seen at a completion event for the SAIC Volkswagen MEB electric vehicle plant in Shanghai, China on November 8, 2019. REUTERS / Aly Song

BERLIN (Reuters) – Carmaker Volkswagen plans to cut up to 4,000 jobs at its plants in Germany by offering early or partial retirement to older employees, a move that could cost several hundred million euros, sources said on Sunday. the company.

Volkswagen said in a statement that it had agreed on a plan with the works council to open up partial retirement to those born in 1964, while offering early retirement to those born between 1956 and 1960.

Volkswagen said it expected up to 900 workers to opt for early retirement, while a low number of thousands would choose partial retirement, without giving a precise figure.

Two company sources told Reuters that between 3,000 and 4,000 jobs will be cut in connection with the program to be rolled out at the six German plants of the main VW brand, which now employ about 120,000 people.

The Handelsblatt newspaper, which previously reported on the plan, had said the company would cut up to 5,000 jobs.

Volkswagen declined to comment on the cost, which will depend on how many employees accept the offer. One source put it at close to 500 million euros ($ 598 million).

As the 83-year-old automaker tries to become a Tesla-inspired tech company, Volkswagen said it would increase the training budget by € 40 million to € 200 million.

Volkswagen said it was also extending the hiring freeze until the end of 2021. Previously, it had only been in effect until the first quarter. Outsourcing can only be done in areas like electric cars, digitization, and battery cell development.

The Volkswagen Group said in January that it would reduce overhead costs by 5% and acquisition costs by 7% over the next two years.

Reporting by Jan Schwartz, written by Emma Thomasson; Edited by Edmund Blair


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