It was known that the energy transition in the automotive sector and the transition to electricity would have a cost in terms of employment. Now the numbers are starting to pop up. Group CEO Herbert Diess would have proposed to Volkswagen’s supervisory board to evaluate the possibility of cutting up to 30,000 jobs to reduce costs and improve competitiveness with competitors such as Tesla, according to the German business newspaper Handelsblatt. A spokesman for the works council, led by Daniela Cavallo since May, called this hypothesis “absurd and unfounded”.
In reality, this plan follows the one already presented by Diess at the end of 2016, then translated last March in a tranche of 5 thousand of which a thousand early retirements, to lower costs by 5% by 2023. It seems that the conditions have changed, with the spasmodic acceleration of electrification programs.
“There is no doubt that we must address the competitiveness of our Wolfsburg plant in view of new market entrants,” VW spokesman Michael Manske told the German newspaper. “The debate is ongoing and there are many good ideas, but there are no concrete scenarios.”
The problem is the comparison with the entry on the playing field, in Germany, of the American producer led by Elon Musk. The new gigafactory in Gruenheide, 50 minutes from Berlin, sets standards that challenge Volkswagen in its home. And it could start in operation within the year. Tesla produces its Model 3 car in 10 hours, while Volkswagen takes 30 hours to make an ID.3. “Tesla is setting new standards of productivity and scalability in Gruenheide,” Manske said, referring to the capacity of the new site, which will produce 5,000 to 10,000 cars per week, more than double the total number of German battery electric vehicles in 2020.
Volkswagen is also considering listing its car charging and energy division in addition to existing IPO plans for its battery division, chief technology officer Thomas Schmall told Manager Magazin in an interview. Schmall said nothing has yet been decided and that it will likely take up to two years for the new companies to be formed and actually ready for the stock market. “We also need to think in terms of overall systems,” said Schmall. referring to Tesla’s solution, with its own charging network, solar systems for green electricity and auto insurance policies.