Volkswagen's Balanced Approach to Crisis Management

Volkswagen has devised a comprehensive savings plan to navigate financial challenges without resorting to mass layoffs or plant closures. The plan involves a 10% salary reduction for 4,000 managers over the next couple of years, with further reductions planned until 2030. This move is part of a socially responsible job reduction strategy that will see the elimination of 35,000 positions without forced redundancies. Production will be scaled down by 734,000 units, equivalent to the output of two to three plants.

The company aims to save 1.5 billion euros annually, with employees agreeing to forego wage increases and bonuses. Despite the production cuts, Volkswagen plans to introduce nine new models by 2027 to maintain competitiveness. The decision not to close plants has been met with relief, particularly in Emden. Meanwhile, Volkswagen's leadership and the workers' council have reached a compromise, ensuring that the financial burden is shared among managers, employees, shareholders, and the company itself.

The plan has been welcomed by stakeholders, with calls for further political support to ease bureaucratic hurdles and reduce taxes. This strategy exemplifies a balanced approach to managing economic difficulties while safeguarding jobs and future growth.