Volkswagen expects to lose 25,000 jobs

Volkswagen assembly line workers put together the auto maker's VW Tiguan and Touran models in Wolfsburg, central Germany. © Odd Andersen
Europe’s largest car producer Volkswagen says a shift to electric cars will force the company to slash 25,000 job openings in the coming years, the Frankfurter Allgemeine Zeitung newspaper reported, citing the carmaker’s head of human resources.

As vehicles with electric motors are made of fewer components than vehicles with combustion engines, “we will need fewer employees in the long-term"said VW Group Chief Human Resources Officer Karlheinz Blessing.

According to the HR chief, the global scandal over VW cheating emission tests isn’t the main factor behind the planned job cuts, but “now the pressure to act, however, is greater."

Volkswagen will pay as much as $15.3 billion after admitting it cheated on US diesel emissions tests for years. The German car maker has agreed to buy back vehicles from consumers and invest in cleaner technologies. VW will pay up to $2.7 billion over three years to enable the US government to replace old buses, bringing the fine closer to the $18 billion VW had prepared to cover costs of the scandal.

Blessing added that the board plans no compulsory redundancies, "but we will reduce a number of employees." VW expects up to 25,000 staff to be cut over the next decade as older workers retire.

Management and labor leaders will meet to discuss the company’s cost cuts before a November 18 meeting of the supervisory board to approve future spending plans.

The talks with unions may fail, as workers insist VW should invest in its own battery production.

According to Blessing, VW is considering the possibility but no decision has yet been made.

"If 30 percent of the value creation will be in the battery system in the future, it is right to consider whether we will step in and to what extent. We cannot leave that to others. How deeply we will engage is a matter we will discuss as part of the future pact,” he said.