Volkswagen CEO Oliver Blume told employees in an internal memo that the company could eliminate another 50,000 positions, Reuters reported, marking the first confirmation of the German automaker’s plans to reduce its workforce by up to 100,000 jobs.
READ MORE: Volkswagen CEO Looks to Avoid Plant Closures as Automaker Moves to Cut Costs
Despite already agreeing to 50,000 job cuts, Blume noted that Volkswagen must lower costs further after determining a 20% cost disadvantage compared to its rivals. The memo therefore referenced a “theoretical deduction” of an additional 50,000 global jobs.
Blume recently said Volkswagen’s “fundamental realignment” has entered its next phase after three years of restructuring. Reuters’ report of the memo came a few days after the automaker announced plans to slash nearly half of its vehicle lineup amid a sales plunge. According to the company, second-quarter group sales fell 8.6% to fewer than 2.1 million vehicles. Volkswagen has not disclosed which models it intends to cut.
The CEO also told Germany’s Bild am Sonntag newspaper that he would try to avoid plant closures. However, Reuters cited anonymous sources who said labor representatives on Volkswagen’s supervisory board blocked proposals that reportedly included job cuts and the possible closure of four factories. In the memo, Blume said the company “cannot confirm competitive use cases for the [German] plants of Emden, Hanover, Zwickau and Neckarsulm in the 2030s.”
