Volkswagen has had many sales hits over its long history that include cars like the original Beetle, the Golf hatchback, Jetta compact sedan and Passat mid-sized sedan. However, there are some changes coming very soon.
VW brand chief Thomas Schaefer told staff during a meeting at its Wolfsburg, Germany headquarters that the brand is “no longer competitive,” citing high costs and low productivity to blame for recent woes.
But as the car market starts to make a shift towards an electric future, one of the largest carmakers in the world is going to make some drastic changes.
Managers at VW told staff that it will be implementing near $11 billion in savings programs that will include a reduction in staff.
Volkswagen human resources board member Gunnar Kilian said that the staff changes will not explicitly mean that people are laid off or fired, noting that the savings to be achieved can be done through agreements on partial to early retirement.
Though reducing staff size is a concerning highlight of the plans to save the large company money, it is not all, or most, of the plans that VW has in store to achieve its near $11 billion savings goal.
“We need to finally be brave and honest enough to throw things overboard that are being duplicated within the company or are simply ballast we don’t need for good results,” said Kilian.
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Currently, Volkswagen (VLKAF) -) is making plans to expand its electric car presence throughout Europe and the United States, with plans for a sub-$35,000 EV to hit the U.S. market by 2027.
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