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🇩🇪 Germany /Economy & Trade

VW Plants Face a ‘Race for Survival’ as Savings Plan Deepens Rivalry

From Die Zeit · () German

Translated from German and summarized by DistantNews. Read the original for the full story.

At a glance

Newswire Named sources New plan
  • Volkswagen's latest supervisory board decisions have intensified competition among plants threatened by restructuring, automotive expert Werner Olle said.
  • Olle proposed a site-specific agreement for Zwickau to reduce labor costs and suggested developing new models with Chinese partners.
  • Volkswagen has approved plans to cut another 50,000 jobs worldwide amid weak demand and growing competition from Chinese automakers.

The latest decisions by Volkswagen's supervisory board have turned the company's threatened plants into competitors in what automotive expert Werner Olle calls a “race for survival.” He said the challenge now falls not only to management, but also to the trade union and works council.

Olle argued that Zwickau could protect its future through an individual agreement for the plant that lowers labor costs. He said a similar approach had worked in the 1990s. The plant is building a circular-economy operation alongside vehicle production, but Olle said that business would offer prospects to only a fraction of current employees and would have far less impact on suppliers. He also rejected defense production as a suitable alternative for a factory designed for large-scale manufacturing.

The race for survival has begun.

· Werner OlleThe automotive expert described the intensified competition among Volkswagen's threatened plants.

In his view, the only sensible path is to keep building cars. He pointed to Volkswagen rival Stellantis, which includes Opel, Peugeot, Fiat and Citroën. Like Volkswagen, Stellantis faces overcapacity and is cutting jobs. One possible model would be to develop new vehicles with Chinese partners, rather than simply opening German factories to Chinese models.

That would be a new path for VW and Audi.

· Werner OlleOlle proposed developing new models with Chinese partners.

Olle cited a planned fully electric SUV developed by Opel and Leapmotor that will be built in Zaragoza, Spain. “That would be a new path for VW and Audi,” he said, adding that there was still enough time to pursue it by 2030. Such partnerships could reduce development time and product costs, he argued, and would suit Zwickau's record as a pilot plant for electric mobility and the circular economy.

Volkswagen is dealing with falling demand for cars and competition from Chinese manufacturers. Its supervisory board recently approved another 50,000 job cuts worldwide, in addition to previously agreed reductions of 50,000 positions in Germany by 2030. The future of the Emden, Zwickau, Hanover and Neckarsulm plants remains uncertain, with those sites repeatedly mentioned as possible closure candidates.

It has shown that it can take on completely new challenges.

· Werner OlleHe cited Zwickau's experience with electric mobility and the circular economy.
About this summary

Originally published by Die Zeit in German. Translated, summarized, and contextualized automatically by DistantNews, with a note on how the source frames the story. Not individually reviewed before publishing. How this works.

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