Volkswagen cost-cutting deal is a “viable concept for the future,” says Lower Saxony premier

Lower Saxony Premier Olaf Lies described Volkswagen’s agreement on cost-cutting measures as a “viable concept for the future” for the company.

Lies, a Social Democratic Party politician and member of Volkswagen’s supervisory board, said the package would bring heavy investment in the company’s future and improve its competitiveness. He said the plan should create long-term prospects for all locations, including new vehicles where economically viable and new forms of industrial value creation.

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viable concept for the future

He also called the supervisory board’s decision a new beginning, while warning that much work remained for the collective bargaining partners, politicians and Volkswagen’s management. The board, he said, had received a clear mandate along with clearly defined tasks.

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At the same time, we will develop long-term prospects for all locations, with new vehicles where this is economically viable and with new forms of industrial value creation.

The agreement comes as Volkswagen and Germany’s auto industry face what Lies described as enormous challenges from international competition. The package, approved unanimously by the supervisory board, envisages the loss of another 50,000 jobs over the coming years.

Four plants, in Emden, Zwickau, Hanover and Neckarsulm, face uncertainty. Volkswagen said it could not guarantee competitive follow-up production at those sites from 2031 to 2034, and would examine alternative uses for them in parallel. Lower Saxony owns 20% of the group and is represented on the supervisory board by Lies and Deputy Premier Julia Willie Hamburg.

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Today’s decision is the beginning of a common path, but a great deal of work now lies ahead for everyone involved.